Following the new trade deal struck between the United States and the European Union, global exports to the U.S. could be cut in half. President Donald Trump has announced a 15 % tariff on most European goods entering the United States, including automobiles. According to projections from the Observatory of Economic Complexity (OEC) tariff simulator, by 2027 global exports to the U.S. will fall more than 46 % below the average of the past three years—a drop of roughly US$2.68 trillion. Conversely, U.S. exports to the rest of the world are expected to rise 12 % above the same three-year average, an increase of about US$1.59 trillion.

       The projection is based on an extended gravity model designed to estimate how the U.S.–EU trade deal will reshape global trade flows. It does not incorporate the sweeping tariff increases set to take effect on 1 August.

       “When the U.S. imposes tariffs on the rest of the world, the rest of the world does not impose tariffs on each other,” notes César Hidalgo, professor of economics at the Toulouse School of Economics, director of the Center of Collective Learning, and founder of Datawheel—the developer of the OEC tariff simulator.

       “The key point,” he adds, “is that in many similar cases countries naturally reorient their trade away from the U.S. This is true for most nations, except Mexico and Canada, whose ties to the U.S. are too tight to allow rapid adjustment.”

       Using Germany as an example, Hidalgo explains: without new tariffs, German exports to the U.S. were projected to rise from US$133 billion in 2023 to US$155 billion in 2027. With a 15 % tariff, that figure is expected to reach only US$149 billion in 2027.

       Under the 15 % tariff scenario, the simulator forecasts larger U.S. imports from the United Kingdom (+US$22.5 billion), France (+US$10.2 billion) and Spain (+US$5.65 billion), while purchases from China (-US$485 billion), Canada (-US$300 billion) and Mexico (-US$238 billion) shrink.

       With China sending far less to the U.S., the model expects China to import more from Russia (+US$70 billion), Vietnam (+US$34.4 billion) and Saudi Arabia (+US$28 billion) than from the United States. Chinese imports from the U.S. are projected to fall by US$101 billion.

       Logistics experts have warned for months that even rates below April’s proposed reciprocal levels would keep prices high. Layered tariffs will push import prices even higher, prompting firms to cut shipment volumes. Retail executives say this will narrow the variety of goods on U.S. shelves—something American consumers have long taken for granted.

       Andrew Abbott, CEO of Atlantic Container Line, says the final tariff numbers will be decisive for many European shippers.

     “We’ve seen ocean orders for high-value products—construction equipment, agricultural machinery, aerospace equipment, transformers—placed on hold,” Abbott notes. “A U.S. customer buying a US$300,000 machine could face US$90,000 in tariffs, so some companies are waiting for the final rates. Meanwhile, importers of lower-value goods are still placing orders.”

  Which sectors will be hit hardest?  

       According to trade data compiled and analyzed by OEC, bills of lading—which list detailed product and company information—show that IKEA is the single largest EU exporter to the United States, accounting for 28 % of the total. It is followed by Southern Glazer’s Wine and Spirits (9 %), Continental Tire (4 %), Bosch (4 %), Dole Food Company (3 %), and Diageo (2.3 %).

       Among product categories, furniture tops EU exports to the U.S. at 11 %, followed by rubber tires (7 %), bedspreads (6 %), and wine (5 %).