Trade between Europe and the United States experienced a wild ride in 2025, with American companies rushing to stockpile European goods before new tariffs hit and then watching the flow shift dramatically afterward.
In March 2025, US imports from Europe surged by a whopping $83 billion over twelve months as businesses scrambled to beat the tariff deadlines. This rush created a record monthly trade deficit as warehouses filled to the brim with European products. Think of it like shopping before a big price increase—everyone wanted to grab what they could while prices stayed low.
Despite the tariff turbulence, European exports actually held strong throughout the year. By the third quarter of 2025, EU export volumes hit record highs with 3.6% year-on-year growth. While shipments to America became more volatile and dropped after March, European exporters found new customers. Sales to the UK, Norway, Switzerland, Turkey, and other destinations picked up the slack. Central banks’ policy shifts also influenced demand and financing conditions for exporters, affecting trade flows and prices interest rates.
The trade balance between the regions shifted noticeably. Europe’s trade surplus with the US shrank from €81 billion in the first quarter to €41 billion by the third quarter. By November, the US deficit with Europe widened to $14.5 billion as imports jumped $7.7 billion while exports declined slightly.
Cars and auto parts dominated European exports to America, totaling $32 billion in the first three quarters. European luxury vehicles command higher prices than their American counterparts, giving EU manufacturers an advantage in the premium market. Different safety and emissions standards also make it harder for US automakers to sell vehicles in Europe.
Meanwhile, an interesting pattern emerged with China. US imports from China declined substantially after tariffs kicked in, and exports to China also dropped—signs of economic decoupling. The relationship with Europe looked different, showing reshuffling rather than separation. China’s exports rose overall by $22 billion in December 2025 compared to a year earlier, despite the large fall to the US market.
America’s overall trade deficit reached $56.8 billion in November 2025, the highest in four months. Total US-EU trade in the first half of 2025 reached $551 billion, establishing the baseline for measuring 2026’s performance. Looking ahead, prediction markets are tracking whether first-half 2026 trade will increase or decrease compared to 2025, with official data expected in August 2026.
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