German industry leaders reacted with sharp criticism on Sunday after U.S. President Donald Trump threatened to impose a series of escalating tariffs on European allies to pressure Denmark into selling Greenland.

The announcement has sparked anger across Germany, with business groups warning that tying controversial political goals to economic sanctions is unacceptable and could set a dangerous precedent.

“If the EU gives in here, it will only encourage the U.S. president to make the next ludicrous demand and threaten further tariffs,” said Bertram Kawlath, president of the German engineering association VDMA. Volker Treier, a foreign trade specialist at the German Chamber of Commerce and Industry (DIHK), added: “Highly controversial political goals are being tied to economic sanctions in an unacceptable manner.”

German industry is particularly vulnerable to tariffs because of its export-driven economy, which is still emerging from a two-year slowdown. Products like cars, machinery, and chemicals are heavily dependent on global trade, and Trump’s Greenland tariffs risk derailing a period of relative calm following the EU-U.S. trade deal agreed last summer.

The VDMA and DIHK, joined by leaders from Germany’s automotive association VDA, called for a unified European response. This could include deploying the EU’s never-before-used “Anti-Coercion Instrument,” which allows the bloc to retaliate against third countries that exert economic pressure to influence European policy.

German automakers are already counting the cost. Volkswagen estimated that tariffs cost up to 5 billion euros in 2025, while Mercedes-Benz, Porsche, and chemicals giant BASF have also been affected. Volkswagen’s home state of Lower Saxony, a major industrial hub, expressed concern that higher tariffs could threaten Europe’s largest economy amid an industrial slowdown.

“This form of U.S. trade policy does not create any winners,” said Thorsten Groeger, a union leader with IG Metall. “It harms consumers, employees, and companies alike—on both sides of the Atlantic.”

Germany exported over 135 billion euros ($157 billion) in goods to the United States between January and November 2025, down 9% from the previous year, though the U.S. remains the country’s top export destination.

Trump’s Greenland tariff threat comes as the president ramps up pressure on Denmark to sell the strategically important Arctic island, further straining transatlantic relations and raising concerns across Europe.