In a significant development for aviation, the aviation industry has been spared tariffs in the preliminary agreement announced by the United States and the European Union have reached a to stabilise their economic relationship amidst escalating tariff disputes.
The agreement includes exemptions for key industries, with aircraft and aircraft parts among those spared from tariffs, maintaining a zero pc duty for the time being. The aviation industry, a cornerstone of both economies, has been a focal point in the tariff saga. The US had previously imposed tariffs on European aircraft, targeting Airbus, while the EU retaliated with countermeasures against Boeing, reflecting a long-standing dispute over subsidies to these aerospace giants.
Both Airbus and Boeing have advocated for a return to tariff-free trade, citing the mutual losses incurred in previous trade conflicts. Industry leaders, including Airbus CEO Guillaume Faury and Boeing CEO Kelly Ortberg, have echoed calls for a restoration of a 1979 agreement that eliminated tariffs on civil aircraft among 33 nations.
While the agreement secures zero tariffs for now, an ongoing US investigation into aircraft subsidies could alter this arrangement.
Financial markets are expected to react positively to the news, following months of volatility driven by tariff uncertainties. Details of the agreement remain under scrutiny, with airlines and manufacturers seeking clarity on its implications.
The deal sets a baseline tariff of 15pc on most EU exports to the US, a compromise following President Donald Trump’s earlier threat to impose a 30pc tariff on European goods from 1 August if no agreement was reached. The negotiations, described as crunch talks held in Scotland, have averted a potentially damaging trade war that could have disrupted global markets.
These tit-for-tat tariffs, rooted in a 17-year World Trade Organisation battle, were temporarily suspended in 2021, but fears of their reinstatement loomed large earlier this year. In April 2025, the Trump administration ended the duty-free status for aircraft trading, prompting the EU to consider countermeasures worth up to €100bn, including tariffs on US aircraft.
The deal leaves unresolved questions about steel tariffs, with the EU claiming a quota system will apply, while Trump insists on maintaining a 50 pc rate. The aviation industry remains hopeful that the zero-tariff status will hold, preserving the integrated supply chains that underpin transatlantic aerospace trade.
