The German Federal Minister for Economic Affairs and Energy, Peter Altmaier, told Austrian public broadcaster ORF on Friday that Germany is willing to come to the table to ease trade tensions with the US.
Mr Altmaier said: “We are ready to talk about low, equal duties on cars.
“This would be the best solution for everyone.”
Mr Altmaier’s surprise comments came after an EU trade ministers meeting in Innsbruck.
US duty on imports from the EU is only 2.5 percent, resulting in a trade deficit for the US.
President Trump previously threatened to slap tariffs on German cars, starting a trade war with EU, unless the bloc changed their tariffs.
He said: “The European Union is possibly as bad as China, only smaller.
“They send a Mercedes in, we can’t send our cars in.”
The tough talk seems to have worked wonders with the EU, who are now scrambling to resolve the issue.
EU Trade Chief Cecilia Malmström warned yesterday American tariffs on European cars “could absolutely happen” and she is “waiting for US reactions” on an EU proposal.
She said trade experts from both sides will hold discussions “later this month” and meet with US Trade Representative Robert Lighthizer at the end of November to try and avoid an escalation.
However, asked whether Brussels is willing to accept quotas that would protect a limited amount of car exports from tariffs, Ms Malmström said: “The European Union can never accept anything that is not compliant with WTO.”
Trade experts have argued voluntary export restrictions, such as the car export quotas in the new US-Canada-Mexico deal, are against WTO rules.
This is unlikely to worry the US President however, who previously said he would withdraw from WTO if they don’t “shape up” and start treating the US in a way he perceives more fairly.