Mubasher: The European Union’s (EU) leaders are considering talks on reducing tariffs between the world’s largest car producers in a bid to evade a total trade war with the US, reports said on Wednesday.

The European Commission “is studying whether it would be feasible to negotiate a deal with other big car exporters such as the U.S., South Korea and Japan,” the Financial Times (FT) reported, citing three diplomats briefed on the matter.

Under the proposed deal, all parties would agree on reducing duties to certain levels for a specified set of products, the FT said.

This concept is known as “plurilateral agreement,” under which countries ink accords on tariffs without including the entire membership of the World Trade Organization (WTO), the FT elaborated.

The proposal is being considered by officials in Brussels before a meeting between the president of the European Commission Jean-Claude Juncker and US President Donald Trump in Washington slated for late July.

The move could reduce export costs for auto sectors of the participating countries, while it could address President Trump’s claim that his country’s auto industry is unfairly treated.

It is worth noting that the Trump administration threatened to levy a 20% tariffs on car imports from the EU, if the 28-state bloc does not lift duties on US vehicles.

Moreover, the EU currently levies 10% tariffs on the imported passenger vehicles, versus the 2.5% duties implemented by the US in the meantime.