Germany is braced for catastrophic car tariffs that could send the country into a deep economic shock and create a perfect storm for Europe, experts have warned.

US taxes on car imports could act as a massive jolt to the bloc’s economy, wiping €14.5bn (£12.9bn) off GDP, according to analysis from investment advisers, Redburn. The firm’s economists believe a “nasty turn” in EU-US trade tensions is coming, which when combined with market nerves over Italian debt, could shake the eurozone.

If the US presses ahead with tariffs, Germany, which relies on carmaking for a fifth of its manufacturing activity, could see 0.28pc shaved from its GDP alone, Redburn claims.

A darkening world economic outlook, including a slowdown in Germany’s major export destination China, mean US tariffs could tip the country into stagnation or even recession.

The country’s government predicts its economy will grow by just 0.5pc in the year ahead, even without the imposition of import levies. This has serious repercussions for the eurozone as a whole. Germany is the bloc’s biggest economy and the source of one-third of its economic output.

Redburn predicts a broad-based rise in trade tensions between the US and EU, following research in Brussels.