chet lawrence hope for the best. for him, series has been shaken up. join us next week for ricky, will and jason. see you then. >> the more you know. >> good morning. >> and welcome. >> to street signs. >> i'm julianna tatelbaum, and these are your headlines. president trump triggers his trade war, imposing 25%. >> tariffs on mexico. >> and canada. and 10% on. >> china. >> saying it's payback for being ripped off. >> in the past. >> we may have short term, some. >> little pain. >> and people understand that. >> but long. >> term the united states has been ripped off by virtually every. >> country in the world. >> markets turn deep red in

reaction, with european majors shedding more than 1%. as trump says, the eu is next in the crosshairs. europe's carmakers suffer the brunt of the selloff, with volkswagen and stellantis the most exposed to trump's tariffs. vw saying it's counting on constructive talks to defuze the trade war. and the dollar surges against its peers as european central bank governors warn that trump's tariffs risk igniting inflation in the. >> eurozone once again. >> the ecb is. mario centeno tells cnbc that europe must take action. >> we are. >> probably use. >> a little. >> bit too much. >> to be. >> sitting in the passenger seat. i think we need to take the steering wheel. we have the means to do that. >> well, a very good morning to you and a warm welcome to the program. president trump has done it. he's ignited a trade war hitting canadian and mexican

imports with a 25% tariff, while putting levies of 10% on chinese goods. the duties are set to come into effect from tuesday at 501 gmt. let's get a check on the market reaction to the news of tariffs out over the weekend. as you can see beside me, it is a sea of red for european markets. you've got the stoxx 600, the main benchmark, down more than 1%, and every sector is participating in the sell off every region as well. looking at the bourses individually, here's the picture in europe this morning. we've got the ftse 100 here in the uk down 1.3%. the xetra dax, bearing the brunt of the sell off, down 1.6%. the cac40 over in france, down 1.5 in the ftse mid down by more than 1%. so every major region off more than 1% this morning. and when we talk about the scale the magnitude of what's impacted here, that would make sense. deutsche bank's jim reed highlighting this morning for some perspective that these three countries that have been targeted make up around 40% of

imported us goods at around $1.35 trillion. for comparison, in the first trump administration, the tariffs that were put in place, the us targeted around $350 billion of chinese goods. so major, major scale that we're talking about here now in terms of sector gainers in europe this morning. here's a picture of those impacted the least. perhaps you've got telcos utilities insurance and media most resilient. it is the laggards that are most important though this morning the sectors that are bearing the brunt of the sell off the auto sector down 3.2%. auto makers obviously heavily reliant on manufacturing operations across north america, not just in the us but across the continent, highly complex supply chains as well. you've got basic resources off more than 2%, technology also selling off quite hard, about 2%, industrials down 2% as well. not up on the board there. but we've got the luxury names also seeing some heavy selling this morning in terms of the asian market reaction. very similar to what we're seeing in europe. you've got heavy selling in japan

nikkei 225 off about 2.7%, the kospi in south korea off 2.5% of the topix, also selling off about 2.5%. as for us markets, here's a picture or an early picture anyway, of what wall street is in store for very heavy selling there. the dow jones, looking at a more than 500 point drop at the open. the tech heavy nasdaq also looking to sell off quite heavily about 360 points. the s&p 500 looking a little bit more resilient this morning off about 85 points at this stage according to us futures. now we're also seeing a heavy reaction in forex markets, as you would expect a plunge in euro dollar. we're currently trading around the 102 level down more than 1% now. trump argued that the moves were needed regardless of the cost. >> we may have short term some. >> little pain and. >> people understand that. >> but long. >> term. >> the. >> united states has been ripped off by virtually. >> every country. >> in the world. >> we have. >> deficits with. >> almost every country, not. >> every country.

>> but almost. >> and we're going to change it. >> it's been unfair. >> that's why we. >> owed. >> $36 trillion. >> we have deficits. >> with everybody. >> we help everybody. >> we've been. >> helping everybody. >> for years. >> and to be honest, i don't. think they. >> appreciate it. >> so we're going to change that. we're going to change it fast. >> now in terms of responses from these key governments, canada has retaliated against president trump's tariffs hitting $155 billion worth of goods with a 25% tariff, with prime minister justin trudeau adding that it doesn't have to be this way. mexico has yet to show its hand, but president claudia sheinbaum slammed trump's tariffs and vowed retaliation. as for china, it's yet to unveil any retaliatory tariffs but has pledged to take necessary countermeasures. the commerce ministry says it will file a lawsuit with the wto over the levies, adding that trump's measures do not resolve america's own issues. the foreign ministry also specifically addressed fentanyl, describing it as america's

problem. we are getting some of the first reaction out of europe this morning. eu leaders are gathering for an informal retreat in brussels today, with trump saying economic measures against the bloc will definitely happen. sylvia has been tracking all of the european reaction and she joins us now, sylvia. so europe obviously not targeted in this first round of tariffs. but president trump has made very clear that europe is in site to be hit next. what do we know in terms of what is possible and how the european leaders are preparing? >> that's it. they know that for. >> the time. >> being. >> they haven't. >> been targeted as of yet in terms. >> of tariffs. >> from the united states, but they. >> know. >> very well they could be next in line. >> as a result. >> though, there's. >> no doubt that today's. >> informal summit in brussels will. definitely address some. >> of these topics. the idea with. >> the summit. was actually to discuss defense and investment. >> in that space. >> however. >> the investment, the events over the. >> weekend, i should say. have to. >> some extent changed the mood. >> in brussels and the expectation. >> is that the eu leaders will

have to. >> address some of the questions on what. >> they could do if. >> the united states. >> announces trump. >> announces tariffs. >> with that. >> in. >> mind, i want. to show you this. >> comment from. >> president donald trump. >> in terms. >> of indeed. >> announcing potential. >> new duties. >> on the eu. >> we have over $300 billion deficit. they don't take our cars. they don't take our farm products. >> they take almost nothing. and we. take everything from them. >> millions of cars, tremendous amounts of food and farm products. so the uk. >> is way. >> out of line. >> and we'll. >> we'll see. >> the uk. but european union. >> is really out. >> of line. uk is out of line, but i'm sure that one. i think that one can be worked out. but the european union is it's an atrocity. >> it's way out of line. you heard the comment there. from donald. >> trump, and. >> we. >> know the eu has. >> been. >> preparing for this. >> potential event. >> so that has not changed from

a european perspective. so let's take a look at some of the details here. between. >> the trade relationship of the eu and the united states, the most. >> exported goods from the european. union into the united. >> states is actually medical and pharmaceutical products, followed by motor cars and vehicles. so that could be the sector that could be hurt the most. >> if. >> we indeed see tariffs from the united states. on the other hand, let's not forget. >> that this. >> is a two. way relationship. >> the european. >> union also. >> buys products from the united states. >> in terms. >> of imported. >> goods from. >> the into the european union. >> oil and. lng are among the top goods. >> that the europeans buy from the united states. >> now, we. know that there's. >> a realization. >> in brussels that perhaps buying more energy from the united states is the way forward here. >> to. >> mitigate a. potential severe trade conflict with the. >> united states. >> there's perhaps no. >> way. >> really around that. i just want to share this comment with you from one of my sources. >> a senior. >> eu diplomat told me over the

weekend that the hope. >> of the eu is. >> to negotiate. >> with the united states. >> if they impose tariffs on the bloc, but ultimately it will be very hard to avoid. >> a severe confrontation. >> ultimately, this will depend on what donald trump will say, what they what he will announce, what sort of detail will get from the white house. but no doubt that brussels is preparing for that eventuality. >> sylvia, thank you for bringing us up to speed and tracking all of the eu leaders. comments for sylvia's article on the potential discussions around trump's tariff announcements at today's eu leaders meeting, and how measures could impact the bloc. head online to cnbc.com. for now, let's continue the conversation with duncan edwards, ceo of british american business. duncan, great to have you with us. thanks for stopping by the studio. what is trump looking to achieve with these tariffs in your view? >> well, i think. >> the president's been. >> pretty clear. >> during the campaign. that he wants to. >> bring economic activity back

to the united states, and he's. >> going to. use trade policy. >> he's going to use tax policy, regulatory policy and lower energy prices. all combined in order to try. >> to persuade. >> companies that if they. >> want to sell to the us market, they need to manufacture or create their economic activity inside the us market. i think it's as simple as that. >> well, in terms of where we go next, and i think everybody is trying to understand now, is this going to be a one off, or are these going to be the first in a series of escalating, escalating tariffs or broadening of the trade war? do you think that he's intending to get concessions from these countries and wants those concessions come, the tariffs will be lifted. how are we going to measure the progress? >> it's really hard to know, isn't it, that during the previous administration, the tariffs that were imposed around steel and aluminum lasted the entire course of the presidency and were only parked under the biden administration? they

weren't solved by the way they were parked. you know, i think he's talked about the external revenue service. so the idea being that the tariffs become a integral component of government revenue, clearly we would be unhappy if that were the outcome. i think all businesses are unhappy with the additional costs that these tariffs have imposed. but i think it's a realistic prospect that these become long term fixtures in the us economy. >> you know, looking through and reading, listening and speaking to people throughout the morning, it's really hard to find any proponents of using tariffs to achieve these goals. i mean, you heard from ecb's, not just, for example, saying that there are no winners here. everybody is a loser in a trade war. and yet we see the administration putting them forward. where are the bulls of these policies. >> yeah. >> well it's very interesting isn't it. because if there are no winners, why is retaliation then seen as a the right

response. precisely. you know, and that doesn't make any logical sense at all. if you believe that tariffs damage your, your own population, then you wouldn't impose them in retaliation either. look, i think this is all part of as i said before, this is all part of the america first plan to bring to use incentives and disincentives. and clearly tariffs are a disincentive to bring that economic activity back into the united states. and i think look, i think companies will will act accordingly. a lot of uk companies that i represent, yeah, already have manufacturing inside the united states, but they'll be thinking about whether it makes economic sense for them to do more of that. us companies who we also represent here may think, well, maybe we should do more of our manufacturing or more economic activity back in the united states. and it'll be it'll be a question of working out the model, you know, are the extra costs of labor. do those offset

the cost of tariffs? and it'll be a straight piece of mathematics? >> well, let me ask you about the uk and europe more broadly. clearly europe hasn't been targeted in this first round. but trump has signaled that europe could be next and is likely to be next. is there any chance that europe and the uk could get ahead of potential tariffs by committing to things like doing more business, setting up more operations in the us, or is it too late for that? >> honestly, i think for the eu, tariffs are going to come. uk is maybe in a slightly different position. the uk has a much more balanced trade, a trade balance with the united states. it's pretty neutral. obviously the eu has a huge surplus with the united states. i think there are other issues where trump feels quite warm towards the uk. he commented this morning that he likes sir keir starmer, for

example. who knows whether. and of course defense issues are also playing to what you know, uk has a very big defense budget relatively, so maybe that helps, but that the smart money is on tariffs coming at the eu and potentially coming to the uk. >> so the uk may not get a carve out. if we do see tariffs come this direction. >> i think it would be quite brave to bet that way that somehow last time the uk was not exempted from the steel and aluminum tariffs, nor was it exempted from the fallout from the large civil aircraft dispute, the boeing airbus dispute, you may remember which which hit a lot of which ended up with tariffs on a lot of uk goods. so i there's no guarantee the uk gets a carve out. but it does have a chance. >> the lastly, in terms of the impact of these tariffs, china is obviously been targeted 10% tariffs on chinese goods. and there is a view floating around this morning that if china is

dissuaded from exporting to the us as a result of these tariffs, then we're going to have a lot of chinese goods available. and they may come to europe, they may come to the uk. and this could have, you know, a major impact on inflation in these countries. how should the uk or how should we think about the uk from that perspective as a secondary ripple impact from these tariffs. >> yeah. >> well there's two issues here. isn't the one hand the consumer may benefit. you know if there is a supply of lower cost goods that can't find a home in the united states, and they come to the uk and the eu, then the consumer may benefit. i'm not sure government will be particularly pleased about that. i think there is pressure on uk manufacturing. anyway. the issue about whether the uk should put tariffs on chinese electric vehicles is still a live issue, so all of this adds to pressure on the on the uk government at a time when it's not that easy anyway. >> yeah. well duncan, we'll leave it there. thank you so much for joining us this morning. duncan edwards, ceo of

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>> i have. >> transformed my. >> skincare routine. >> today, the top 100 public companies ranked on issues of workplace ethical leadership and environmental responsibility. america's most just companies revealed who's in the top spot today? squawk box six eastern cnbc. >> welcome back to street signs. let's get a check on the market reaction where things stand now to donald trump's new tariffs announced against mexico, canada and china over the weekend. you've got the stoxx 600 down about 1.4% around the 532 level. you're seeing heavy selling in the european carmakers, in particular, heavy reliance on manufacturing operations across north america and of course, highly complex supply chain. so that sector sharply in focus. you're also seeing heavy selling in some of the luxury names in europe, as well as the wine and spirits makers. so let's dive

into a little bit more detail on some of the big movers. in terms of european carmakers. let's get a check on volkswagen. the company is counting on constructive talks between trading partners to avoid conflict. after donald trump announced tariffs on goods from mexico, canada and china. volkswagen owns mexico's largest car factory, which produced 350,000 cars in 2023, all for export to the us. you can see volkswagen shares down nearly 6% this morning. it's not the only one. you've got mercedes benz down more than 4%, continental down more than 4%, stellantis down nearly 7%. so heavy selling in the european carmakers in terms of luxury names, one thing to bear in mind when we look at the luxury sector, of course, that we have seen a strong bid for some of these names of late after better than expected results. so perhaps a little bit of the froth coming out of these names. you got lvmh down about 2.5%, carrying down nearly 4%. burberry down 2.6%. but again, we did have a lot of money go into these names recently on the back of earnings, the drinks

makers in focus imported products account for 30 to 35% of u.s. spirits and wines. so this this sector in focus. for that reason, rémy cointreau, down about 3.4%, diageo down about 3% as well. now, the chip makers have also seen some heavy selling this morning. a lot up in the air around what may come next in the chip space from the us administration. could we see this sector targeted next in a big way? you've got asml down more than 3%, asmae, stmicro and infineon all trading sharply lower this morning. dan boardman's weston, the ceo and cio of brg wealth management, joins me now. dan, great to have you with us this morning. you know, on the one hand, we all talk about how we were bracing for tariffs. this was perhaps the number one topic around the new administration. and yet here we are heavy selling across global markets, across asset classes, suggesting that markets weren't priced for this. >> yeah i think that's fair.

>> i think. >> the narrative had built up over the last couple of months that trump wasn't going to follow through with the tariffs, he was just. going to use as a threat for. his domestic. >> political agenda, and to try and get. >> some. concessions out of, well, some of. >> his long standing allies. >> and other countries. >> but clearly that's not the case. and he started the firing pistol on on a global. >> trade. war with. >> what he's. >> done with. >> with canada and mexico and china over the weekend. >> and what do you think of the market moves we're seeing today? i mean, the auto makers off five, 6%. you've got luxury down two, 3%. do these moves make sense? >> yeah. >> i think they i think they do. >> as i say i think the markets have been hoping and pricing in that maybe. this wouldn't happen. so i think it's understandable the moves we've seen. >> i think what will. >> be interesting over the coming days and weeks is whether this expands. also, whether sort of the countries sort of start to retaliate in a greater way. so it'll be interesting to see what china does over the coming days and weeks. and then really, all eyes focus on the european union and the uk as to whether

we will be levied with hit with tariffs as, as well. so i think markets are in for a pretty volatile couple of months as people try and digest what's happening with with tariffs. >> dan, from a sector perspective, which sectors are, in your view, best to avoid what are going to be the biggest losers as a direct result of these tariffs? and where do you think the winners are? >> i think you're seeing us seeing it played out in the market this morning. i think basic materials clearly from a global growth perspective, are suffering. luxury goods companies aren't doing terribly well. drinks companies, auto makers i think there's a whole host of sectors that you're seeing the most violent price action this morning where investors are reappraising the risks that are associated with those stocks under a trump presidency. >> dan, i was reading through some research from deutsche bank this morning talking about the ripple effect of the tariffs that we have so far, putting aside what may come in the

future. db saying that these tariffs are likely to add to deflationary pressure in europe because if chinese goods can't reach the us, then they'll end up in europe. and this means deflationary pressure. and in turn a less hawkish ecb. what do you think of that view. >> yeah i think that's spot on. i've not read that db research yet. but i think monetary policy from a us and european slash uk perspective was already starting to diverge with growth prospects. really not that good in the uk and europe but still relatively good in in america. and so if chinese goods find their way to the, to the continent and into the uk and exert a downward pressure on prices, then i think it gives both the ecb and the boe more scope to lower interest rates more aggressively than markets are anticipating this year, especially as growth is likely to continue to weaken over the coming quarters. >> so how do you tally that with growth expected to weaken but perhaps more supportive policy? how do you tally that from a market perspective? do you want

to put more money to work in the uk? >> yeah, i think the uk and european markets. i mean, a lot of stock markets really are pretty cheap at the moment. it really is just the american market at the top end, which is expensive. and so i think if we've got a tailwind of sort of interest rates falling in the uk and europe and actually sort of growth maybe not as strong, but sort of not atrocious, then i think that's a pretty good tailwind, coupled with very low valuations for uk and european stocks. and i think to a certain extent you're potentially seeing that narrative already play out in january. i mean, who would have thought sort of a couple of months on from trump's election that european stocks would be the best performing markets this year and outstripping the us, and it's similar with the uk large cap. so i think that narrative has further to run, and we're very much bullish on uk and european assets as we as we sort of head through the rest of 2025. >> you know, it's quite a low bar when you talk about growth not being atrocious in these regions. it's hardly the most

compelling by case. i mean, where is the growth going to come from? the little growth that you you see in the uk? >> it's a very tricky question. i mean, i think from a uk perspective, since the budget business confidence is shot to pieces, i think the consumer is an in in an increasingly tricky position with sort of the cost of living and the cumulative impact of interest rate increases starting to hurt them. so it is difficult to see which which parts of the economy are going to, are going to sort of lead us out of this, this tricky bit. i think the government is making the right noises around growth and especially over the last couple of weeks, but we need to wait and see the details on that and whether that is going to spur growth. but really, i think the growth is going to come from a lowering of interest rates. you know, real interest rates are very high in the uk at the moment. and i think that nominal rates have got to come down to really start to kick start the economy and get businesses and consumers spending and investing.

>> and in terms of europe, as we sit here bracing for potential tariffs from the us, how do you get that confidence to invest in europe versus the us? even if all those things you said are true growth isn't as atrocious as we perhaps feared, if we see more supportive policy, you know, if those things are not as bad as feared, but we're still facing the risk of tariffs. how do you get the confidence to invest? >> i think both from a european and uk perspective, just because a company is listed on on one of those stock markets doesn't necessarily mean all of their business activity is there. so you've got a lot of very big and global companies that just have the fortune or the misfortune to be listed in the, in the uk or europe. i think the other thing is, is that and we can all sort of forget this when we get sort of drawn into the day to day hype and narrative of what's going on with tariffs or deep sea or whatever the story of the day is, but the ultimate determinant of long term returns in the stock market is what the price you pay for, for an asset

and at the aggregate level, what you're paying for european assets and uk assets. and for some very good companies in those both of those markets, you're paying very cheap valuations. and that gives me a lot of confidence as a medium to long term investor to be investing there and sort of ignoring a lot of the short term short term noise. >> to what extent is the weaker euro priced into european equities, and is that going to be a tailwind or is it already in there? >> i think a bit of it's already in there. i think clearly the euro will weaken further depending on what happens with tariffs over the coming days and weeks. but i think a large part of that is probably already in the price of, of european equities. but we'll see. time will tell. >> dan, thanks so much for joining us. dan boardman westin ceo and cio of bri wealth management. and for more on the market fallout from president trump's trade tariffs, check out our live market blog on cnbc.com. coming up on the show, friedrich marx's gamble with the far right afd fails to pay off.

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order official state lottery tickets and scratchers from anywhere with jackpocket. n the ceos have a big announcement, they come here first. >> a wild. >> hour of earnings. >> earnings, season, special coverage all this month on cnbc. >> welcome back to street signs i'm giuliana tannenbaum and these are your headlines. president trump triggers his trade war imposing 25% tariffs on mexico and canada and 10% on china, saying it's payback for being ripped off in the past. >> we may. >> have short. >> term. >> some little. >> pain and. >> people understand that. but long term, the united states has been ripped off by. >> virtually every. >> country in the world. >> us chip makers react negatively in premarket trade,

with nvidia, intel and amd under pressure with the nasdaq set to see the worst of the selling at the open. europe's carmakers suffer the brunt of the selloff, with volkswagen and stellantis the most exposed to trump's tariffs. vw saying it's counting on constructive talks to defuze the trade war. and the dollar surges against its peers as european central bank governors warn that trump's tariffs risk igniting inflation in the euro. once again, the ecb's mario centeno tells cnbc that europe must take action. >> we are probably used. >> a. >> little bit too much. >> to be. >> sitting in the passenger seat. i think we need to take the steering wheel. we have the means to do that. >> what a morning for markets. we are now looking at u.s. futures indicating the dow opening more than 500 points

lower in reaction to these new tariffs, tariffs that were widely flagged, widely expected by the market but not priced in. stoxx 600 in europe down 1.4%. we're at the 532 level in terms of individual regions in europe, nothing has been spared. we've got red across the board. the overall benchmark down more than 1%. you've got the dax down nearly 2%. the cac40 over in france down about 1.6%. heavy selling in the automakers. heavy selling in luxury names. chip makers also tumbling this morning after asian markets tumbled overnight. in terms of fx markets, we've seen quite a reaction in the euro down more than 1% versus the dollar. we're currently around 102 50. sterling also on the back foot versus the dollar one 2310. and this of course ahead of the bank of england meeting on thursday, the boe expected to deliver a third rate cut of the cycle. dollar yen holding steady. and there at the bottom of your screens, you see the dollar up very strongly versus the mexican

peso and the canadian dollar. now banque de france governor francois villeroy de galhau described president trump's tariffs as brutal. he said everyone loses in this kind of trade war and refused to rule out the eu. if the eu targets european imports. now his ecb colleague klaus konate took a stronger stance, saying that europe will not be pushed around. and speaking to cnbc, mario centeno, governor of the bank of portugal and fellow ecb policymaker, said europe must be stronger. >> europe must take a much more forceful position in the upcoming months. it is also true and i have been quite a critique on the position that europe takes on, on, on these discussions. we are probably used a little bit too much to be sitting in the passenger seat. i think we need to take the steering wheel. we have the

means to do that. >> now, as we enter the second half of the show, here are four things to get you up to speed ahead of the wall street open. on the economic side, we'll get manufacturing pmi data. stateside, it's relatively quiet on the earnings front today, with palantir technologies and clorox among those reporting. we will hear from two more members of the magnificent, magnificent seven, though later in the week. we'll also hear from several fomc members, including boston fed president susan collins, who's speaking exclusively to our u.s. colleagues. and, of course, u.s. markets will be closely watching, watched after the decision by president trump to impose those tariffs on mexico, canada and china. and of course, here in the uk, we've got the bank of england coming up on thursday. i'm sure some viewers stateside will be keeping an eye on the bank of england. us futures right now we're looking at red across the board. the dow jones looking to open now about 570 points lower. the nasdaq about 370 points and the s&p 500. looking to pull back about 90 points. the chip makers in particular focus after

the roller coaster week that we saw last week in extended trade. you've got all of them down. nvidia of course, the chief stock among them down about 2.9% after hours. now it's shaping up to be a busy week here in europe, with a slew of pmi and inflation data from the eurozone, along with an opec jmmc meeting set for later today. on tuesday, we will again hear from alphabet of the magnificent seven. we're also going to be keeping an eye on israel, where the prime minister, benjamin netanyahu, will become the first foreign leader to visit the white house under the trump administration. we'll get more pmi data on wednesday, and mainland china markets will reopen for trade after the lunar new year holiday. thursday will bring adp's latest u.s. employment report and amazon earnings, along with, of course, as i said, the bank of england decision. and we will round out the week with non-farm payrolls on friday. germany's christian democrats will gather in berlin today for their election summit,

just days after the party's controversial bill calling for stricter migration laws was rejected in the bundestag. friedrich mertz, the cdu cdu leader and frontrunner to become the next chancellor, had been willing to use the support of the far right to push through the bill. anita, fascinating stuff out of germany. you know, it feels like this strategy from friedrich mertz has backfired. to really focus on migration over the economy at a time when germany's economy is struggling so much. now, today, throw into the mix these tariffs from the us and the prospect of tariffs on europe, on germany. are we going to see a pivot from the cdu? >> well i. >> think what he what we are going to see today is that he's rallying the troops behind his position because there were also ten members from the cdu law, parliamentary group, which actually objected his motion or the bill on friday. so i guess

the biggest uproar is that he openly was willing to get those the bill through parliament, with the support of the afd. as such, it's not such a big problem. the afd has been regularly voting for certain bills, but i guess that he openly said, i want to push it through no matter what it cost, has caused to that major uproar. and also like protests across the across the country where people were concerned that he might also be willing to form a coalition with the afd, which the cdu is obviously rejecting. i guess his move is meant to actually regain some conservative voters who didn't feel at home anymore in that rather centrist merkel's cdu, which was very much moved to the left. so it remains to be seen whether this move actually backfires or is actually positive for the cdu going

forward, because clearly he wants to reposition the party to be really conservative, not just somehow somewhat stuck in the middle. but let's take a listen of what he said after the bill failed in parliament. >> he mentioned lawson. >> people outside who are listening and watching us in these turbulent days. >> they don't. >> want us to. >> fight amongst ourselves. >> about the afd. they want us to find solutions on the issues that concern and occupy people's everyday. lives on a daily basis. and above all, we want to find solutions so that people in our country can feel safe again. >> mein damen und herren. >> ladies and gentlemen, it's not too late. >> the fall from grace will be with you forever. but the gateway to hell. yes. >> i. >> say the gateway to hell. we can still close it together. we must build. >> the firewall. you must build. >> up the firewall again. build up the firewall again. >> so what you will present today is a sort of emergency program program. he is pledging to push through as soon he is

going to be the next chancellor of germany. and that does also entail quite a lot of business related measures like tax cuts for corporates, tax cuts also for certain employee groups. so it's a wide range of measures, but also of course also entails of the points against illegal migration. that was the bill which failed on friday. so as i said it remains to be seen whether this is going to backfire or in the end will benefit him. it is, one can argue, a big political gamble started last week. >> anita, thank you so much for breaking it down for us and we will be keeping an eye on berlin today. carsten nickel joins me now managing director at teneo. carsten, you know, i was so looking forward to this conversation about what's going on in germany today in berlin around the election. but it just feels like, you know, it's being

overshadowed by the tariff situation and the threat of potential tariffs on europe. is that the right read? how important actually are these? is the conference taking place in berlin today? >> i mean. >> for us here in london. >> yes for sure. >> it's the it's the right read i guess for average voters in in germany. >> i would. >> say that for now. >> a topic like. >> migration is pretty much front and center. i think that trade. war conversation with the us becomes very serious a when the eu really gets into the spotlight. i mean, so far, obviously we're talking about canada, mexico and china and b, when we're talking about the kind of more political fallout, what. >> is it that. >> the us wants in return? i think those are issues that will really galvanize the interest of voters. but will that happen before the election? that's the question. >> we are getting some live shots of olaf schultz now, speaking to reporters at an informal meeting of eu leaders. we'll keep an eye on any comments that do come through. he's currently speaking in german, but we'll keep an eye out or an ear out for any comments that come through in english. carson in terms of

friedrich merits, he's put a lot of weight on migration as a tactic, as a strategy to lure voters back from the afd, it would seem, rather than focusing on the economy, is that the right strategy, or is he going to be forced to pivot? >> i think from his perspective, he probably felt last week he had no choice. and that follows, obviously, this string of violent attacks that we have seen. now the cdu is ahead, right, 30% in the polls. runners up are the afd at 20. my impression is that matz's calculation last week was if i don't demonstrate that there is a alternative at the political center, the afd rises further. his initial idea a couple of weeks ago was, let's talk about the economy and let's leave migration aside. i think these attacks have made this impossible for him. >> is there any chance that he pivots back in the, you know, the three weeks ahead? >> that's what he will try today at the party conference in berlin, trying to focus on the economic program, a couple of

other legislative initiatives by the current government that he wants to roll back. whether that is possible is a different question, because obviously, the center left olaf schulz and his coalition partners have a great interest on rubbing in that message and saying, look at what he did last week. can you trust this man in the chancellery? >> and what about, you know, let's say that friedrich merz gets elected, which is the overwhelming assumption here. the overall overwhelming expectation. is there any chance that we see any kind of coalition with the afd, or is this just about luring voters back and using their support occasionally? >> yeah, absolutely. it's the latter. there's absolutely no prospect for a cdu, afd or any sort of afd coalition after this election. i think if you're worried about afd inclusion into a german government, you need to look at the four year time horizon in a scenario where you get a friedrich merz led government, most likely with the spd, and this voter disgruntlement continues around issues like immigration, perhaps low growth, other stories. does that then make a cdu change of

heart more likely? four years down the line, three weeks down the line? no. absolutely not. >> does elon musk have a much, much bearing or carry much weight in germany? i mean, we know he's been very vocal about supporting a lot of the things that the afd supports. we're all watching the us right now with the tariff, the tariffs and the trade war overhead. >> yeah, it's obviously i mean, that those joint meetings that he's held with the afd, afd leaders that has created a lot of attention. the question is for the afd, if you want to grow beyond 20%, i think you're moving towards the traditional center right. is the center right electorate an electorate that trusts elon musk? i think that's the open question. so if you want to grow further into the center, our voices, like elon musk, are the ones that you want to bet on. open question. >> okay, okay. so let's let's talk about post-election, assuming that we do see some sort of coalition that doesn't involve afd, but that has friedrich moritz at the center of it. there's a lot of pressure coming from the us for germany to ramp up their spending, to make a bigger contribution to

nato, to defense spending. what are we likely to see on that? >> well, frankly, germany has no choice. it is so dependent on the american security guarantee that if that american administration comes forward within the next days or weeks saying those are our demands, germany will have to largely comply. i mean, the positive news, of course, is that you're looking at the only major oecd economy that actually has the fiscal space to do more. the challenge is to get this done politically, because matt's, of course, comes initially from a political direction that is very skeptical on greater spending. >> so will they be able to justify it politically? will they be able to do it? >> they they will have to. this will probably be a key issue in the coalition negotiations. i think the cdu will try very much to portray this, something that as something that is forced upon them, say, by the spd as coalition partners. and that, i think again, is why this migration thing matters. so for me, the interesting question is what will the spd focus on in coalition talks? are they perhaps focusing too much on

softening max's line on migration, and they forget about that investment pitch? that would be negative news, of course, from an overall market perspective on europe. >> and in terms of us, german, us europe relations more broadly, what leverage does germany actually have right now? >> it's very difficult. i think the biggest challenge, actually, for the europeans and for germany is to make sure that they organize a somewhat coordinated front, if you like, on the european side. and i think that will be very difficult because there are many institutions involved. on the european side, you're talking about greenland, then you're talking to the danish government, you're talking about trade, you're talking to the european commission, you're talking about defense spending, you're talking to nato. perhaps greater spending on ukraine membership prospects close to eu ties. it's the european council. where is the european leader who across all these institutions can bring together angela merkel's style? the european side of that conversation, if this issue linkage, the slightly erratic issue linkage comes from

the us, that to me is the big risk to watch. >> and is it frederick merits? >> he will certainly be the one who has to step into that role. he's been around in politics for several decades. he has never served in government, so we really collectively need to be watching. his learning curve. >> hasn't been tested. well, carsten, we'll leave it there. look forward to the continued conversations in the weeks and months ahead. appreciate you coming in to speak with us. carsten nickel, managing director at teneo. coming up on the show, norway closes in on becoming the first ev only country. we'll hear from christina bo, secretary general of the norwegian ev association, after this break. >> you put together. >> like a classic, always work your magic. every time we. >> make this valentine's day one to remember. don't just get

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>> call (888) 710-0554. >> today, the top 100 public companies ranked on issues of workplace ethical leadership and environmental responsibility. america's most just companies revealed who's in the top spot today? squawk box six eastern cnbc. >> welcome back to the program. let's go straight to brussels, where olaf schultz is speaking at the eu informal leaders summit. let's take a listen to what he has to say.

>> when there is a conflict. you have. >> to. >> have it. and that's what we are working on. >> with keir. >> starmer. >> who will be. >> in. norway. >> zusammenarbeit zwischen grossbritannien. >> und der europaische industrie. es geht. >> all right, well, olaf schultz has begun speaking in german. if he returns back to english, we'll keep a listen out and come back to any comments that he delivers. now norway is on track to become the first country in the world to transition completely to electric vehicles in its new car market, ev sales in the country soared to nearly 89% of total auto sales last year, according to data from the norwegian public roads administration, up from less than 1% in 2010. and it says to 96% in the first few weeks of this year. so remarkable progression. let me welcome christina boot to the program secretary general of norwegian ev association. christina, great to have you with us. as norway approaches this milestone, really remarkable. and i think

countries around the world are looking and asking the question, how did norway do it? so when you look back at the last decade, the last 15 years, really, what have been the most effective strategies to ev adoption? >> well, i think it has. >> all to. >> do with having. >> a clear. >> goal and. politics that has sort of been in place over time, not back and forth. and a lot. >> of. >> you know, pulling it back and putting it back in. so january numbers is just in and we're at 96% for january 2025. we will end up somewhere between 95 and 100% this year, probably closer to 100, i think, than 95. and we are celebrating. and i think there's a lot to learn from norway. and the most important lesson is that it's not as difficult as people think. >> well, i think, christina, many would say that that's true. so long as you are a smaller

country in terms of geographic size, charging infrastructure has been a real barrier to adoption in larger countries around the world. how has norway dealt with the challenge of charging infrastructure, and any lessons learned for some of those larger countries? >> norway is actually the size of germany, and only 5.5 million people live here, so it's not as easy in norway as in many other countries around the world. we also have a very cold climate, long distances, mountains and so on. so charging infrastructure has definitely been one of the challenges. but right now we have close to 10,000 fast chargers delivering. yeah, quick charging. and it works really well. close to 30% of all passenger cars on the road are now fully electric. and it works. people can travel all over the country and it's not as

difficult as, as as some people think. in the initial phase, there was a little bit of public spending on this, but after that it's almost only been private investments. different companies putting up chargers because it's fast. as soon as you have enough electric cars on the road, there's also an economic incentive into sort of delivering this, this service. >> so there's really a tipping point, really, where it becomes an easy, an easy win to put up more charging infrastructure. christina. now we're we're talking a lot more about autonomous driving, especially as ai becomes more and more advanced. how do you see the emergence of autonomous driving impacting the market in norway? >> well, i think norway, i think this is what we see first in bigger cities, like like in the in la and in bigger cities in the us. there's tests also in norway with especially freight,

but i think it's still a bit bit away before we see this everywhere, and especially in a country as norway, where we have a lot of snow and different changing weather, i think, yeah, it will take some time, but the development is fast, so i might be surprised that it comes faster than than i think. >> and i guess for those looking on to what their future might look like if ev penetration rises in other parts of the world, what are your biggest challenges now that ev penetration is so high? nearly 100%. >> well, the challenge challenge is having our politicians sort of keep at it. luckily, electric cars are getting more and more cheap. battery prices are coming down, so we don't need the tax exemptions that much longer. but of course this has to be sort of balanced with everything

happening globally. so yeah, i think the challenge now is also having all the yeah, 30%, as i said, of car drivers now driving a fully electric car. but we also have to convince the rest of the gang and they, they have been a bit slower, but in general it looks like it's not that difficult. i mean, i meet a lot of people, especially middle aged men, that come up to me and say, i was never going to get an electric car, but now i changed my mind and i drive and they tell me what i drive. so people's minds change about this as soon as they get to try an electric car and see how it works, people actually change their mind. and i think to make that happen, you need some incentives and some push. and that is something i think more countries could, could help with. >> certainly public perception of evs has changed dramatically, but there is still a link

between the price of petrol, the price of gasoline and appetite to transition. and how do you think about that? and is there a risk that if we do see, you know, a drop in the price of petrol, a drop in the price of gasoline, we see a reversal of some of these trends. >> most important in norway has been the taxes or the price of the car. when people buy it as a new car. so we haven't really done that much when it to, to sort of the fuel, the fuel and the cost of the fuel because it's not really a fair way of doing climate policies to raise the price of fuel a lot. a person who can't make the shift yet will then have to pay a lot more to be to use to use their car. so the most important thing you can do is, is start increasing the prices of new cars that cannot run on renewables and help the price down on on cars that are yeah, able to run on renewable fuel.

so that's what we've done. so people that buy a new car get a benefit. if it's a zero emission car and that's how you have to do it. change the cars that is purchased. that's what what is the key. >> christina, thank you so much for joining us. christina booth, secretary general, norwegian ev association. now getting back to markets. the auto sector is in sharp focus this morning. heavy selling in response to trump's tariffs on mexico, china and canada. volkswagen shares down more than 6%. stellantis now down more than 7%. broader european markets also trading lower. it is red across the board. same for wall street. so you do want to stay with cnbc. as i hand you over to our colleagues stateside this is in street signs. thanks for watching. >> they are trying to shut down this legal loophole to get 100 milligram generic viagra, or 20mg generic cialis, delivered to your door for just $0.87 in

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