The trade landscape in the United States has shifted noticeably in recent months, with the U.S. government introducing significant new tariffs not seen in many years. However, this does not necessarily mean that Austrian companies should halt investment in the U.S. The transatlantic relationship between the two countries is strong—with around 950 Austrian subsidiaries in the U.S. and more than €20 billion in Austrian investment creating 60,000 jobs, the U.S. is Austria’s second-biggest export market.
Although the new tariff policy may increase the probability of a recession, the 2025 U.S. GDP is still on a growth trajectory, according to Deutsche Bank’s forecasts. However, their outlook also predicts that inflation will increase by the end of the year.
Prioritizing “Made in the USA”
Beginning in early 2025, the U.S. government—under the authority of the International Emergency Economic Powers Act (IEEPA) and Section 232 of the Trade Expansion Act—began layering tariffs on a wide range of imported goods, following an international trend towards encouraging domestic manufacturing.
What Market Dynamic Should Austrian Companies Expect in the U.S. in the Next 12 Months?
Austrian companies seeking success in the U.S. market benefit from several key advantages, including a strong focus on niche markets, specialized products that generate more elastic demand, a high degree of service orientation, and a strong commitment to quality as a unique selling proposition (USP).
However, they also face notable challenges such as intense price competition and a highly dynamic market environment, ongoing uncertainties related to trade barriers, high market entry costs despite the potential for strong returns, and stiff competition from well-established U.S. networks.
Austrian companies can still seize investment opportunities in the U.S. in the midst of these new tariffs. Daniel Pokerschnig, Vice President of Business Development at Jerich USA Inc., reflects on the situation with pragmatic optimism:
“The current situation reminds me of the early COVID-19 days. Many canceled orders, but those who continued importing captured long-term market share. The U.S. market is still strong and import-dependent.”
Implementing a Strategic Expansion Plan
Austrian companies can consider several strategic alternatives to direct export when entering the U.S. market. Foreign Direct Investment (FDI), such as establishing a subsidiary or acquiring a company in the U.S., offers full control, customer proximity, and tariff-free “Made in USA” benefits. If establishing a site in the U.S., companies can decide if they would rather start from scratch in an undeveloped, less urban space (greenfield development) or a space that has been previously developed (brownfield) and is generally more urban.
Another strategy is licensing, which involves granting technology or brand licenses to U.S. partners. This approach requires lower capital investment, enables faster market entry, and generates income through licensing fees. A third option is forming sales and production partnerships with established U.S. firms, leveraging existing infrastructure and partner networks for market access and allowing for flexible use of resources.
Over the next 90 days and beyond, companies are advised to stay informed by regularly consulting importers and freight forwarders, conducting their own research using resources like the Harmonized Tariff Schedule and the Federal Register, and seeking support from ADVANTAGE AUSTRIA and customs info points. These contacts can support companies in mitigating the impact of the new U.S. tariffs. For example, under USMCA rules, automotive goods that meet specific North American content thresholds may qualify for tariff reductions. Goods with at least 20% U.S. content may also receive partial relief under certain Section 232 provisions.
Looking Ahead
For Austrian businesses, the current situation demands both caution and creativity. While the short-term challenges may be significant, those companies that can adapt quickly and think strategically may emerge stronger and better positioned in the world’s largest consumer market in the long run.
Questions about tariffs, market entry, and more? Watch our webinar here and reach out to us at newyork@advantageaustria.org. We are happy to answer any inquiries you may have as well as connect you with our broad network of experts.
