Greenland tariffs threaten aviation industry
President Trump has set his sights on acquiring Greenland for the US.
President Trump’s proposed imposition of extra tariffs on countries who oppose his plan to take over Greenland could have a damaging effect on the business aviation industry including in the US.
The president told NBC News on Monday he will “100%” follow through on Saturday’s threat to impose 10% tariffs on eight European countries by February 1st because of their protests over his goal to acquire the Danish territory to safeguard US security. The tariffs would rise to 25% by June 1st, he added. The countries are the UK, Denmark, Norway, Sweden, France, Germany, the Netherlands and Finland.
The increased levy on all items imported into the US from these countries means manufacturers and suppliers in business aviation will incur a higher cost, which is likely to be passed on to US companies. For example, the Rolls-Royce BR725 used in the Gulfstream G650/650E and the Pearl 700 engines powering the G700 and G800 are made in Dahlewitz, Germany, while Airbus’ main manufacturing base is in Toulouse, France.
However, there is no detail yet on whether the tariffs will apply across the board or whether certain sectors will be exempt. In July 2025, the EU negotiated for aircraft and their components to be exempt from the US tariffs imposed at the time.
Chad Anderson, CEO, Jetcraft said his company is “closely monitoring developments” around US tariffs and what that might mean for cross-border aircraft transactions.
“Given the global nature of our market, changes to trade policy can influence buyer behaviour, aircraft availability and transaction timelines,” he told CJI. “Periods of uncertainty often require careful planning and clear insight, particularly for clients operating across multiple jurisdictions.”
Tobias Kleitman, president, TVPX is also on tenterhooks, waiting to discover if there will be any “carve-outs for aircraft, engines and parts”.
“It’s at least conceivable that the recent agreement between the US and the EU which provided exemptions for the aerospace industry could be impacted,” he told CJI. “It’s unclear if those carve-outs will go away as a result. Tariffs on goods are based on the country of manufacture. New tariffs could add significant costs to aircraft, engines and parts imported into the US that are manufactured in these EU countries.”
In response to Trump’s threats, posted on the Truth Social platform, the eight European countries issued a combined statement saying the threat of tariffs undermines transatlantic relations and risks a “dangerous downward spiral”. They added they “stand in full solidarity” with Denmark and Greenland.
France’s President Emmanuel Macron said the European Union could activate its “Anti-Coercion Instrument” (ACI) to counter attempts to force policy changes on the EU or member states. The measure, which was approved in 2023 but has never been used, permits import and export restrictions on the outside power in question.
However, the “wild card” at play is the pending US Supreme Court decision on the legality of Trump’s tariff policy, according to lawyer Jonathan Epstein, partner, Holland & Knight.
“The US Supreme Court is expected to rule on whether the president has the authority under the International Emergency Economic Powers Act (IEEPA) to impose tariffs,” adds Epstein.
Speaking at a news conference on the sidelines of the World Economic Forum in Davos on Monday, US Treasury Secretary Scott Bessent said any potential European retaliation over tariffs would be “very unwise”.
