The U.S. will increase tariffs on aircraft imported from Europe to 15%.

The higher tariffs will go into effect March 18, the U.S. Trade Representative (USTR) said Friday, replacing the 10% tariffs the Trump administration put into place on Oct. 18.

That month, the World Trade Organization (WTO) had authorized U.S. tariffs on up to $7.5 billion in annual goods as part of a ruling in an unfair trade practices case brought by the U.S. against the EU for subsidizing the development of Airbus aircraft.

The WTO's October determination was part of a 16-year dispute between the U.S. and the EU over subsidies granted to Airbus and Boeing. Last March, the WTO determined that the U.S. had failed to halt unfair aircraft development subsidies provided to Boeing by the state of Washington. The trade body has yet to determine the value in annual U.S. aircraft and other goods that the EU can levy tariffs on as a result.

In a statement, Airbus said that it "deeply regrets" the decision by the USTR. The move, the company said, escalates trade tensions between the U.S. and the EU, and in so doing it creates more instability for U.S. airlines that are suffering from a shortage of aircraft.

"USTR's decision ignores the many submissions made by U.S. airlines, highlighting the fact that they -- and the U.S. flying public -- will ultimately have to pay these tariffs," Airbus said.

The higher tariffs on Airbus aircraft come as Boeing has suspended production of the 737 Max narrowbody.

"The United States remains open to a negotiated settlement that addresses current and future subsidies to Airbus provided by the EU and certain current and former member states," the USTR said.


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