The structure of Donald Trump’s latest tariff threat reveals a curious discrepancy: a proposed 100% duty on branded drugs versus a 25% levy on heavy-duty trucks. This tale of two tariffs raises a key question: why is the pharmaceutical industry being targeted with a measure four times more severe than the one aimed at the automotive sector?
One possible explanation lies in the nature of the products. Branded pharmaceuticals are high-margin, patent-protected goods. A 100% tariff is so punitive that it is clearly designed not just to discourage imports, but to make them completely impossible. This suggests the goal for the pharma sector is total onshoring or total exclusion.
In contrast, a 25% tariff on trucks is a significant but not necessarily insurmountable barrier. It would raise prices and disrupt the market, but it might not completely halt trade. This could be interpreted as a more traditional protectionist measure, designed to give a competitive advantage to domestic producers rather than to completely eliminate foreign competition.
Another factor could be the perceived vulnerability of the target. The UK’s pharmaceutical industry was a known weak point, as it had been left out of a previous trade deal. The administration may have calculated that it could apply maximum pressure here with minimal risk of a coordinated, bloc-wide retaliation, unlike the powerful and unified German auto lobby.
Finally, the 100% figure could be a purely psychological tool. It is a shocking number that grabs headlines and signals an absolute resolve, intended to frighten the target into immediate concessions. The 25% figure, while serious, is more in line with previous trade disputes. The difference in severity may be a deliberate tactic to send different messages to different industries and nations.
