CNBC Transcript: U.S. Commerce Secretary Howard Lutnick Speaks with CNBC’s “Squawk on the Street” Today

WHEN: Today, Thursday, July 24, 2025

WHERE: CNBC's "Squawk on the Street"

Following is the unofficial transcript of a CNBC interview with U.S. Commerce Secretary Howard Lutnick on CNBC's "Squawk on the Street" (M-F, 9AM-11AM ET) today, Thursday, July 24. Following are links to video on CNBC.com: https://global-deals.online/video/2025/07/24/howard-lutnick-on-japan-trade-deal-structure-we-give-them-the-project-they-pay-for-the-project.html%3C/a%3E and https://global-deals.online/video/2025/07/24/howard-lutnick-on-tiktok-app-will-go-dark-if-china-wont-agree-to-u-s-control.html%3C/a%3E.%3C/p%3E%3Cp%3E%3Cstrong%3EAll references must be sourced to CNBC.

CARL QUINTANILLA: The E.U. is scrambling to strike a trade deal ahead of next week's August 1 deadline. FT did report yesterday that a potential deal would impose 15 percent tariffs on European imports, similar to the Japan number that we got this week. Joining us this morning, Commerce Secretary Howard Lutnick. Mr. Secretary, great to have you. I know you've been busy, streets hungry for an update on the E.U. What can you tell us?

U.S. COMMERCE SECRETARY HOWARD LUTNICK: Well, the E.U. really, really, really wants to make a deal. I mean, what's happened is Donald Trump sent them a letter and said, look, if we don't make a deal, you've got a huge trade deficit. I mean, $235 billion trade deficit, which means they sell us more stuff than we sell them. And so the president said it's 30 percent if you don't get a deal done. So you know how badly they want to make a deal.

QUINTANILLA: Is 15 the new benchmark?

LUTNICK: Well, look, the Japan deal, which I'd like to talk about, was amazing. I mean, not only are they paying 15 percent, but they gave Donald Trump and the American people $550 billion, $550 billion to invest at our -- at Donald Trump's discretion, the American people's discretion to build in America the things that Donald Trump wants to build. Power, generic drugs, shipbuilding, whatever Donald Trump wants to build. The Japanese will finance it for him. Pretty amazing.

JIM CRAMER: Mr. Secretary, I thought that was an incredible gift. And it had to happen. I am very concerned that if there's no deal with Europe, what they'll do to our service companies. It's the only thing that they ever really do -- take from us anyway. How do we protect these great American companies?

LUTNICK: Well, you're right. But they attack our great tech companies every day. They have this DST, Digital Services Act, a Digital Markets Act, also another tax on American technology. And so we're trying to beat that back. And in these trade deals, we talk about it. Look, we think it's reasonable that these companies pay fair tax in Europe. But we've got to stop this onslaught -- of this regulatory onslaught of our tech companies. And Donald Trump's got these tech companies back. And we are working on it. You saw we got rid of it in Canada. We got rid of it in all sorts of countries. They knock it down. That's one of our key objectives.

CRAMER: And let's talk about Korea for a second. I don't know what's going to happen if there's no deal before August 1. But I've got to tell you, they have plants in this country. When you look at the plants they just assembled, all the IP is from Korea. How do we get them to be serious about the plants that they have here?

LUTNICK: Well, what happens is, when it comes into the country, you put a tariff on it. So if you bring the engine in, you pay the tariff. If you bring the parts in, you pay a tariff. So if you tariff the parts, you capture the idea. And we're all over that. Now, you know, the Korean manufacturers, they do produce plenty of cars here. But as you pointed out, they tend to bring a lot of things in from overseas. That'll get caught by these tariffs. And you know the Koreans also, like the Europeans, they very, very much want to make a deal. And when they saw, I mean, you could hear the expletives out of Korea when they read the Japanese deal. Because the Koreans and the Japanese, they stare at each other. And so you can imagine what they were thinking when they saw that Japan made that deal. They were like, oh, man. And of course, they're going to be in my office today talking.

DAVID FABER: Mr. Secretary, you know, when it comes to the Japan deal, the $550 billion in investment, we were trying to grapple with this a bit yesterday. Do we have specifics around where that's coming from, where it's going, what timelines, what metrics, what they're going to be held to? I'm just trying to understand a bit more around what is obviously a very large number.

LUTNICK: So the key is, this is not regular foreign investment. This is not Toyota building a plant in America. That's what normally people think about. This is literally the Japanese government itself saying to Donald Trump, we will provide Donald Trump and the American people $550 billion on projects you choose. And we will give you 90 percent of the profits, America. So basically, Donald Trump can pick the projects. And we are working the details out now. We're doing the documentation right now. But here's an example. Donald Trump says, look, we don't make generic antibiotics in America. We don't make antibiotics. So let's go build those factories. Let's go invest $15 billion and let's take care of generic antibiotics. And bam, the Japanese will finance it for us. It doesn't cost us money. And those profits, 90 percent of the profits stay in America. 10 percent go back to the Japanese to pay the cost of funding. And that's it. We don't have any obligation to pay anything other than 90-10 split. So Donald Trump can take care of America and solve it.

FABER: And they're under an obligation to actually provide, to provide that financing. I mean, is there a way you're going to measure it if they're in violation? Or, you know, I'm just curious over what time period?

LUTNICK: It's easy. This is so easy, right? We give them the project. They pay for the project. They don't pay for the project, their tariff is going to go sky high the next day. They're going to pay for the project. This is easy to execute.

FABER: OK, on something else I wanted to come back on, which is TikTok. There was -- there was some reporting yesterday, but I know you did an interview, but I don't think you talked about TikTok. So I'm curious because I know that's also under your aegis. Where are we on that in terms of dealing with the Chinese and whether or not they're actually going to allow the algorithm to be potentially transferred? And we get a buying group here that takes it out of Chinese control.

LUTNICK: Right, it's got to come out of Chinese control, right? We've made the decision you can't have Chinese control and have something on 100 million American phones. That's just -- that's just not -- that's just not OK. So if it's in American control and, you know, China can have a little piece or ByteDance, the current owner, can keep a little piece. But basically, Americans will have control. Americans will own the technology and Americans will control the algorithm. That's something Donald Trump is willing to do. If that deal gets approved by the Chinese, then that deal will happen. If they don't approve it, then TikTok is going to go dark. And those decisions are coming very soon. So let's see what the Chinese do. They've got to approve it. The deal is over to them right now.

FABER: Is it part of the overall trade talks with China?

LUTNICK: Well, yes and no. I would say it's not really part of the trade talks, but you can't really go meet somebody and not bring up the topics that are open. So that's, that's sort of, you know, it's not officially part of it, but unofficially, of course, it's going to be discussed.

QUINTANILLA: And finally, Mr. Secretary, on Japan, there were some complaints yesterday from the domestic auto lobby that some cars made by U.S. producers might be facing higher levies than cars built entirely in Japan. Does that -- do they have that right?

LUTNICK: That's just, oh my God, that's just so silly. I mean, come on, you know, 15 percent by the Japanese. OK, it's not as good as 25 percent. When your competitor goes from 25 percent against them to 15 percent against them, I guess you're a little bummed out. But come on, there's no tariff if you build it in America, and they're paying 15 percent. I'm telling you, the American manufacturers, I spoke -- I spoke to the CEOs this morning. They are cool with it. They were just, you know, their PR people were just sort of ginning up a little, a little concept that, oh, we're not as happy as we used to be. But the American manufacturers are going to do extremely well in America. As long as they build it in America, you build it in America, you're good.

QUINTANILLA: Mr. Secretary, good to talk to you. We'll watch the tape closely and look forward to your return, Commerce Secretary Howard Lutnick.