US tariff relief for UK carmakers and aerospace comes into force

Western Telegraph

30-06-2025

Car manufacturers exporting to the US will face a 10% tariff quota, down from 27.5%, while the aerospace sector will see a 10% levy removed entirely.
Sir Keir hailed the 'historic trade deal' with the US, clinched after Donald Trump imposed the import taxes as part of his 'liberation day' tariffs on countries across the world.
US President Donald Trump (left) and Prime Minister Sir Keir Starmer speaking to the media at the G7 summit in Kananaskis, Alberta, Canada (Stefan Rousseau/PA)
The Prime Minister and US president finalised the deal for those sectors at the G7 summit, but levies on steel have been left standing at 25% rather than falling to zero as originally agreed.
Talks are ongoing to secure 0% tariffs on core steel products from the UK.
The executive order signed by Mr Trump suggests the US wants assurances on the supply chains for UK steel intended for export, as well as on the 'nature of ownership' of production facilities.
Sir Keir said: 'Our historic trade deal with the United States delivers for British businesses and protects UK jobs.
'From today, our world-class automotive and aerospace industries will see tariffs slashed, safeguarding key industries that are vital to our economy.
'We will always act in the national interest – backing British businesses and workers, delivering on our Plan for Change.'
Business and Trade Secretary Jonathan Reynolds said the deal would save hundreds of millions each year and safeguard thousands of jobs.
'We agreed this deal with the US to protect jobs and support growth in some of our most vital sectors – and today, we're delivering on that promise for the UK's world-class automotive and aerospace industries.'
Kevin Craven, head of aerospace trade association ADS, said the sector 'hugely appreciated' the efforts to reach a deal.
Society of Motor Manufacturers and Traders chief executive Mike Hawes said the agreement was 'good news for US customers and a huge relief for the UK automotive companies that export to this critically important market'.
The Government is also due to update Parliament on Monday on ethanol and quotas on US beef.
Under the deal, it was agreed that a 20% tariff on US beef imports to the UK be removed and the quota for US beef raised to 13,000 metric tonnes.
The Vivergo Fuels site near Hull (Vivergo Fuels/PA)
A 19% tariff on ethanol imports from the US is also due to be removed, with a tariff-free quota of 1.4 billion litres of US ethanol applied.
The bioethanol industry says the deal has made it impossible to compete with heavily subsidised American products.
The UK's largest bioethanol plant warned last week that it could be weeks from stopping production.
Hull-based Vivergo Fuels said the start of talks with the Government was a 'positive signal' but that it was simultaneously beginning consultation with staff to wind down the plant.