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The European Union (EU) is preparing a strong countermeasure package in response to U.S. tariffs, though it still hopes to avert a transatlantic trade confrontation through diplomacy, European Commission President Ursula von der Leyen said on Tuesday.

Speaking to lawmakers at the European Parliament in Strasbourg, Ms. von der Leyen said the bloc remains committed to dialogue but is prepared to act decisively if Washington proceeds with new protectionist measures.

“Our objective is a negotiated solution,” she said. “But of course, if need be, we will protect our interests, our people, and our companies. We do not necessarily want to retaliate. But if it is necessary, we have a strong plan to retaliate, and we will use it.”

Her remarks come just days before the United States is set to raise tariffs on imported automobiles, an escalation of a broader trade policy shift under President Donald J. Trump, who has already reimposed duties on steel and aluminum. The White House has also indicated plans to unveil a new framework for “reciprocal tariffs” on Wednesday, part of a wider effort to reassert American leverage in global trade.

Ms. von der Leyen acknowledged that Washington's complaints about imbalances in global trade have merit and that the European Union, too, has faced challenges within the current system. She also expressed understanding for America's desire to re-industrialize, a goal shared by the bloc, but pushed back against the method.

“These tariffs are, in effect, taxes on American consumers,” she said. “They will fuel inflation and make it more expensive for American factories to purchase components, ultimately costing jobs.”

While relations between Washington and Brussels have historically withstood economic strain, recent U.S. trade actions have revived concerns in Europe about the durability of the transatlantic alliance in an era marked by shifting global power dynamics and rising economic nationalism.

The European Commission president’s tone was measured but firm — a reflection of the delicate balancing act Brussels faces as it seeks to maintain open channels with Washington while defending its economic sovereignty and internal cohesion.

Ms. von der Leyen also used her address to call for deeper European economic integration, pointing to internal market inefficiencies that hinder cross-border commerce. Citing data from the International Monetary Fund, she said internal trade barriers within the bloc are the equivalent of a 45 percent tariff on manufacturing and a staggering 110 percent on services.

“To be strong externally, we must also be strong internally,” she told members of Parliament. “Europe needs to diversify its trade, and we need to reduce the barriers within our own single market.”

She added that the Commission will present proposals next month aimed at dismantling these internal barriers and preventing the creation of new ones, a move seen as part of a broader effort to strengthen Europe’s resilience in the face of external pressures.

Whether the situation escalates into a full-blown trade war or is resolved through negotiation remains uncertain. But for now, the European Union is sending a clear message: it is prepared to defend its economic interests, with diplomacy, if possible, but with countermeasures if required.

With additional reporting from agencies.Bottom of Form