US tariff relief for UK carmakers and aerospace comes into force
30 June 2025 09:31
LONDON (dpa)Tariff cuts for the automotive and aerospace sectors have come into force after UK Prime Minister Keir Starmer finalised parts of a deal for relief from US import taxes.Car manufacturers exporting to the United States will face a 10% tariff quota, down from 27.5%, while the aerospace sector will see a 10% levy removed entirely.Starmer hailed the "historic trade deal" with the US, clinched after US President Donald Trump imposed the import taxes as part of his "liberation day" tariffs on countries across the world.The prime minister and US president finalised the deal for those sectors at the Group of Seven (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 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.Starmer 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."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 tons.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 US products. The UK's largest bioethanol plant warned last week that it could be weeks from stopping production.
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