US Trump’s Tariffs on Türkiye: Risks and Opportunities

US President Trump’s new tariffs on Türkiye—10 percent on imports and 25 percent on automotive products—pose significant challenges for key industries but may offer strategic opportunities, especially through lower rates compared to competitors like China and the EU.

By Giulia Interesse

As US President Donald Trump’s sweeping new tariff regime sends shockwaves through global trade landscape, Türkiye finds itself navigating a delicate balance of risk and opportunity. While the country has been hit with a baseline 10 percent US import tariff—part of Trump’s broader effort to reshape international trade—many Turkish officials and economists see potential strategic gains amid the disruption.

In a notable shift, on April 9, 2025, President Trump announced a 90-day pause on tariff hikes for all countries except China. While China’s tariffs were sharply increased to 125 percent, Türkiye, which had not retaliated against U.S. tariffs, continues to face the existing 10 percent blanket tariff. This temporary reprieve applies to all non-retaliatory trade partners through July 2025.

With higher tariffs targeting key competitors such as China and the European Union, Türkiye’s relatively moderate rate could offer a comparative advantage in select export sectors and attract foreign manufacturers seeking more favorable trade conditions.

At the same time, Turkish exporters remain wary of the indirect fallout—particularly through supply chains linked to the EU—underscoring the complex position Ankara now occupies in a rapidly shifting global trade order.

In this article, we examine how Türkiye is positioning itself in response to the United States’ new tariff regime, exploring both the immediate economic risks and the longer-term strategic opportunities.

Sectors most at risk

Automotive sector

The automotive sector stands as one of the most directly impacted by the newly imposed 25 percent tariff on cars and car parts. In 2023, Türkiye exported approximately US$826 million worth of vehicles and related components to the United States. According to aid Ali Özçete, president of the Turkish Automotive Aftermarket Association (OSS), this increased by 20.3 percent in 2024 from the previous year, reaching US$1.04 billion–a significant figure that now faces immediate pressure.

The steep tariff places Turkish exporters at a substantial competitive disadvantage, particularly against domestic US manufacturers and countries that may negotiate exemptions or already enjoy favorable trade arrangements.

Analysts expect the higher cost of Turkish automotive products to lead to a decline in US demand, which could in turn disrupt production lines and weaken supplier networks across Türkiye. Given the country’s role in providing both finished vehicles and intermediate parts, the automotive sector’s exposure is both direct and systemic.

Steel industry

Türkiye’s steel industry has long been vulnerable to shifts in US trade policy, having been targeted in previous tariff cycles. Under the current regime, the sector once again finds itself under pressure, as the 10 percent blanket import tariff is applied without exceptions.

Steel exports to the US are particularly sensitive to pricing, and any additional cost burden could render Turkish products less attractive in an already competitive global market. Moreover, the broader implications for international steel demand—particularly from Türkiye’s EU trading partners, who now face higher US tariffs—add a layer of indirect risk. 

Textile and apparel

The textile and apparel sector remains one of Türkiye’s most globally competitive industries, and while the United States represents a notable export destination, its current share of the US market remains under 1 percent. Nonetheless, Türkiye exported approximately US$2.68 billion in textiles to the US in 2023, and the sector has shown renewed growth—exports rose 14 percent year-on-year in early 2025, suggesting a push to re-establish a stronger foothold in the American market.

In 2024, Türkiye reaffirmed itself as the world’s seventh-largest exporter of textile and ready-to-wear products. Within its clothing exports, knitted apparel and accessories—such as t-shirts, pullovers, and similar items—dominate, accounting for over half of the sector’s total value. Historically, the US was a significant market for Turkish garments until the expiration of the WTO’s Multi-Fibre Agreement in 2005, which led to a sharp drop in Turkish exports due to increased competition from Asia. Now, with around 40 percent of the Turkish garment industry prepared to export to the US, there is renewed ambition to capture more of the market.

However, the introduction of a 10 percent tariff on all goods entering the US market could stall this momentum. Given that textile manufacturers typically operate with slim margins and are highly sensitive to price changes, even modest increases in cost can influence American sourcing decisions. The sector also contends with structural challenges, including dependency on imported raw materials and exposure to economic fluctuations.

Despite logistical advantages—Türkiye can deliver by ship to the US in under three weeks and provides fast overland shipping across Europe—price competitiveness remains critical. While Europe continues to account for over 70 percent of Türkiye’s garment exports thanks to the Customs Union, the US remains an important growth target. The new tariff regime threatens to undercut that strategy, raising concerns that the recent upswing in US demand could prove short-lived if cost pressures are not mitigated.

Strategic advantages amid US Trump’s tariffs on Türkiye

Turkish officials, including Finance Minister Mehmet Simsek, have pointed out that the country’s relatively low tariff rate may give it a comparative advantage in some sectors. Türkiye’s free trade agreements with 54 countries and a customs union with the European Union mean that it can rely more heavily on markets outside the US and EU, with 68 percent of its exports directed to countries outside these regions.

Additionally, experts see potential opportunities for Türkiye to capitalize on the shifting global trade landscape. As manufacturers in higher-tariff countries like China face increased costs, they may seek to relocate production to countries with lower tariffs, such as Türkiye.

This dynamic could lead to new investment opportunities and increased manufacturing in Türkiye, particularly as companies look to reorient their supply chains.

All in all, while the US tariffs present challenges, particularly for industries like automotive and textiles, Türkiye’s diverse trade partnerships and relatively favorable tariff treatment could position it to mitigate some of the negative impacts, turning the current global trade shifts into an opportunity for economic growth and increased foreign investment.

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