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WTO warns of trade crisis as German car bosses face U.S. tariff talks

Reuters  |  WOLFSBURG, Germany 

By Edward Taylor

WOLFSBURG, (Reuters) - The global system of international trade is in crisis, the (WTO) warned on Tuesday, as German car bosses gathered in hoping to stave off potential tariffs on U.S. imports of luxury cars.

Top officials from Daimler, and have been summoned to the to meet to discuss U.S. efforts to rebalance global trade.

The meeting comes after months of warnings from U.S. that he might impose big tariffs on imported cars, and days after he agreed a truce in a broader trade war with

"The system is in crisis mode and how this plays out remains to be seen," WTO told the Handelsblatt automotive summit in Wolfsburg,

Global trade and welfare cannot continue when large countries take unilateral action which deviates from common rules and principles, Brauner warned.

"You need legal certainty and predictability, and if everybody just does whatever they want, it's over," Brauner said, adding the visit by German car bosses may help understand the impact of tariffs on global trade.

Trump warned German carmakers in 2017 he could impose a 35 percent tax on vehicles imported to the unless there was some "rebalancing" of trade.

There were too many cars rolling down New York's Fifth Avenue, Trump said, lamenting that Europeans were not buying enough Chevrolets.

The White House's demand to meet German car bosses comes despite the fact it is the that formally handles trade negotiations on behalf of the

To try to assuage Trump officials, German car bosses will outline plans for increasing the proportion of components produced in the

(VW) will reiterate it is looking to expand its U.S. to include electric cars.

German carmakers are among the largest net exporters of vehicles to and from the United States. and Mercedes, for example, build most of their sport utility vehicles in U.S. plants and import luxury limousines built in to

has its largest global in Spartanburg, South Carolina, while VW has a plant in Chattanooga, Tennessee, and builds cars in Tuscaloosa,

"The German car bosses will not try to negotiate international trade policy, but they will ensure that the people in have the same understanding about the impact of their policies as the of Chattanooga," Brauner said.

Around 10,000 local jobs depend on each model built in Chattanooga, the city's told the conference in a Webcast interview.

(Reporting by Edward Taylor; Editing by Mark Potter)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, December 04 2018. 18:02 IST