Donald Trump has threatened a 20% tariff on all European cars if the EU does not remove trade barriers introduced on Friday.
His threat - which if carried out would represent a serious escalation of the burgeoning trade war - comes hours after new EU tariffs on goods imported from the US came into force.
In response to Mr Trump's tariffs on European steel and aluminium, the EU has imposed tariffs on imports of US cranberries, orange juice, sweetcorn, peanut butter, bourbon whiskey, cigarettes, cigars, cheroots (a type of thin cigar), cosmetics, motorbikes, boats, jeans, leather footwear, swimwear, underwear and steel products.
Its duties target goods worth $3.3bn (£2.5bn).
The US president tweeted: "Based on the Tariffs and Trade Barriers long placed on the U.S. and its great companies and workers by the European Union, if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!"
The trade war risks significantly raising prices for consumers.
Just 20 minutes before the president's tweet, the EU's ambassador to the US, David O'Sullivan, tweeted "that the EU-US economic relationship is the most important in the world bar none".
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