President Trump said the European Union is not upholding its part of a trade agreement.
He threatened to increase tariffs on European cars next week.
The announcement escalates a long-running trade dispute between the United States and Europe.
Trump argued that the EU has failed to meet commitments made in previous negotiations.
The president specifically targeted the European automotive industry with the higher levies.
Higher tariffs could raise prices for European car brands sold in the U.S. market.
The move risks triggering retaliatory measures from the European Union.
Economic analysts warn the action could disrupt global supply chains.
The tariff increase is scheduled to take effect in the coming days.
