- The United States and the United Kingdom have reached a new trade deal.
- The first 100,000 British cars imported to the U.S. will have a lower 10% tariff.
- Detroit’s big 3 are upset a deal was struck with the UK before Canada and Mexico.
President Donald Trump and British Prime Minister Keir Starmer have announced a new trade deal between the United States and the United Kingdom. While it’s a wide ranging deal, British automakers have a lot to celebrate.
Under the terms of the agreement, the first 100,000 vehicles imported into the United States by UK automakers each year would be subject to a 10% tariff. After that point, the tariff would increase to 25%.
While British automakers, including Jaguar Land Rover (99,277 units sold in 2024), Mini (26,299), Rolls-Royce (1,765), Bentley (3,840), McLaren (1,270), and others like Lotus, collectively exceed the 100,000-unit threshold, not all of those vehicles are built in the UK. According to the BBC, UK vehicle exports to the U.S. totaled 100,000 units in 2024, valued at around $12 billion.
More: Trump’s Tariffs Just Cost Ford Buyers Up To $2,000
Aside from automotive imports, the White House claimed the deal “will significantly expand U.S. market access in the UK, creating a $5 (£3.8) billion opportunity for new exports for U.S. farmers, ranchers, and producers.” This is slated to include more than $700 (£528) million in ethanol exports as well as $250 (£189) million in other agricultural products such as beef.
The White House went on to say the 10% reciprocal tariff remains in effect, but there will be a “new trading union for steel and aluminum.” The Prime Minister’s office said these tariffs have gone from 25% to 0%, meaning UK steelmakers can carry on exporting to the US.
While specifics are a little hazy at the moment, Downing Street billed the deal as a “historic agreement” that will “slash tariffs … for UK carmakers, steelworks, and farmers – protecting jobs and providing stability for exporters.” The government went on to say car export tariffs will be reduce from 27.5% to 10%, which will save “hundreds of millions a year for Jaguar Land Rover alone.”
The Big Three Aren’t Happy
While British automakers won big, American companies cried foul. The American Automotive Policy Council – which represents Ford, General Motors, and Stellantis – slammed it as benefiting British automakers more than ones in America. As Council President Matt Blunt explained, “The U.S. automotive industry is highly integrated with Canada and Mexico; the same is not true for the U.S. and UK. We are disappointed that the administration prioritized the UK ahead of our North American partners.”
Blunt went on to point out it will be “cheaper to import a UK vehicle with very little U.S. content than a USMCA compliant vehicle from Mexico or Canada that is half American parts.” He added this “hurts American automakers, suppliers, and auto workers” as well as sets a horrible “precedent for future negotiations with Asian and European competitors.”
