Volkswagen on Tuesday warned against the "harmful economic impact" of tariffs that U.S. President Donald Trump is proposing on imports from Mexico, where Europe's top carmaker operates a major factory.

"The Volkswagen Group is concerned about the harmful economic impact that proposed tariffs by the U.S. administration will have on American consumers and international automotive industry," a Volkswagen spokesperson said in an emailed statement to Reuters.

Volkswagen warns that Donald Trump’s proposed 25% tariff on Mexican car imports could harm consumers and the global auto sector, risking a new North American trade war.

The German carmaker is already contending with a sales slowdown, high costs, and competition from cheaper Chinese competitors. View on euronews