logo
US tariffs a 'significant shift' for Malvern car company

US tariffs a 'significant shift' for Malvern car company

BBC News27-03-2025
A car company boss says a new import tax of 25% on cars and car parts coming into the US would be a "significant shift" for the business.Morgan Motor Company in Malvern exports around 200 sports cars to the US every year, which makes up around a third of its overall revenue. US President Donald Trump announced on Wednesday that the new tariff would come into effect on 2 April.Managing director Matthew Hole said the move would have an impact on the company. "It's a big chunk of our business; we make a £55m turnover a year so, although it's too early to estimate, we can say it will cost a lot of money," he said.
"At the moment, we have two [Morgan] models that we sell to the USA, the Plus Four and the Super 3, and that is about a third of vehicle turnover specifically, which is £48m annually."Despite the blow, Mr Hole said the 115-year-old company, which employs around 200 people to make the cars that sell for around £80k each, had been preparing for the "tariff war"."Because it's such a significant shift of our business, we have been working on plans for this over the last month or so, since this tariff war news has been escalating."We've been making sure that we have some kind of a contingency plan in place, which limits the affect on our customers and limits the damage to ourselves," he said.A company spokesperson added: "A rough cost for a Plus Four in the US is $100k. Customers will see an increase on this, but we are working to ensure that it isn't a direct 25% increase."President Trump said the tariff would lead to "tremendous growth" for the US car industry and promised it would spur jobs and investment.A number of countries have expressed anger at the move. Canada called it a "direct attack", while China accused the government of violating international trade rules.
Follow BBC Hereford & Worcester on BBC Sounds, Facebook, X and Instagram.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Bullion markets breath sigh of relief after Trump says gold will not face tariffs
Bullion markets breath sigh of relief after Trump says gold will not face tariffs

Reuters

time20 minutes ago

  • Reuters

Bullion markets breath sigh of relief after Trump says gold will not face tariffs

Aug 11 (Reuters) - U.S. President Donald Trump on Monday said he would not impose tariffs on gold, a move welcomed by global bullion markets and which ended days of speculation that the yellow metal could be caught up in the ongoing global trade spat. "Gold will not be Tariffed!" Trump said in a statement posted on his social media account. He gave no details. The U.S. Customs and Border Protection had posted a ruling on its website on Friday saying that Washington might place the most widely traded gold bullion bars in the United States under country-specific import tariffs, which would have rocked the metal's global supply chains. In response, a White House official told Reuters on Friday that the Trump administration was preparing an executive order "clarifying misinformation" about tariffs on gold bars and other specialty products. A U.S. gold tariff would have been especially harmful for Switzerland, a major refining and transit hub for gold. Trump's Monday post removes that concern. "Delighted to hear the crisis has been averted," said Ross Norman, an independent gold market analyst. "It will come as an enormous relief to the bullion markets, as the potential for disruption was incalculable." U.S. gold futures dropped 2.4% to $3,407 per ounce after Trump's post on Monday, reducing a premium over spot gold , the global benchmark, which fell 1.2% to $3,357. Shares of Barrick Mining ( opens new tab fell 2.8% on Monday afternoon after the company posted quarterly results, while shares of Newmont (NEM.N), opens new tab - the world's largest gold miner - were down slightly to $68.87. Both companies are major U.S. gold producers.

Trump opens door to sales of version of Nvidia's next-gen AI chips in China
Trump opens door to sales of version of Nvidia's next-gen AI chips in China

Reuters

timean hour ago

  • Reuters

Trump opens door to sales of version of Nvidia's next-gen AI chips in China

Aug 11 (Reuters) - U.S. President Donald Trump on Monday suggested he might allow Nvidia (NVDA.O), opens new tab to sell a scaled-down version of its next-generation advanced GPU chip in China, despite deep-seated fears in Washington that China could harness American artificial intelligence capabilities to supercharge its military. Trump also confirmed and defended an agreement calling for U.S. AI chip giant Nvidia, led by Jensen Huang, and Advanced Micro Devices (AMD.O), opens new tab to give the U.S. government 15% of revenue from sales of some advanced computer chips in China, after his administration greenlit exports to China of less advanced AI chips known as the H20 last month. "Jensen also has the new chip, the Blackwell. A somewhat enhanced-in-a-negative-way Blackwell. In other words, take 30% to 50% off of it," Trump told reporters in an apparent reference to slashing the chip's capability. "I think he's coming to see me again about that, but that will be an unenhanced version of the big one," he added. Trump's administration halted sales of Nvidia's H20 chips to China in April, but the company said last month it had won clearance to resume shipments and hoped to start deliveries soon. "The H20 is obsolete," Trump said, saying China already had it. "So I said, 'Listen, I want 20% if I'm going to approve this for you, for the country'," he added. The deal is extremely rare for the U.S. and marks Trump's latest intervention in corporate decision-making, after pressuring executives to invest in American manufacturing and demanding new Intel CEO Lip-Bu Tan resign over ties to Chinese companies. Analysts said the levy may hit margins at the chipmakers and set a precedent for Washington to tax critical U.S. exports, potentially extending beyond semiconductors. The U.S. Commerce Department has started issuing licenses for the sale of H20 chips to China, another U.S. official said on Friday. Both the U.S. officials declined to be named because details have not been made public. The China curbs are expected to cost Nvidia and AMD billions of dollars in revenue, and successive U.S. administrations have sought in recent years to limit Beijing's access to cutting-edge chips that could bolster China's military. Washington does not feel the sale of H20 and equivalent chips compromises national security, said the first U.S. official. The official did not know when or how the agreement with the chip companies would be implemented, but said the administration would be in compliance with the law. The U.S. Constitution prohibits Congress from laying taxes and duties on articles exported from any state. The Export Clause applies to taxes and duties, not user fees. When asked if Nvidia had agreed to pay 15% of revenues to the U.S., a company spokesperson said: "We follow rules the U.S. government sets for our participation in worldwide markets." "While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide," the spokesperson added. A spokesperson for AMD said the U.S. approved its applications to export some AI processors to China, but did not directly address the revenue-sharing agreement and said the company's business adheres to all U.S. export controls. The Commerce Department did not immediately comment. China's foreign ministry said the country has repeatedly stated its position on U.S. chip exports. The ministry has previously accused Washington of using technology and trade measures to "maliciously contain and suppress China." The Financial Times, which first reported the development, said the chip firms agreed to the arrangement as a condition for obtaining the export licenses for their semiconductors, including AMD's MI308 chips. It added that the Trump administration had yet to determine how to use the money. "The Chinese market is significant for both these companies so even if they have to give up a bit of the money, they would otherwise make it look like a logical move on paper," AJ Bell investment director Russ Mould said. Still, analysts and experts questioned the logic of resuming sales if the chips could pose a national security risk. "Decisions on export licenses should be determined by national security considerations and the tradeoffs of U.S. policy goals, not a revenue-creating possibility," said Martin Chorzempa, senior fellow at the Peterson Institute for International Economics, an independent research institution. "What it ends up creating is an incentive to control things, to then extract a payment, rather than controlling things because we're actually concerned about the risk to national security." U.S. Commerce Secretary Howard Lutnick said last month the planned resumption of sales of the AI chips was part of U.S. negotiations with China to get rare earths and described the H20 as Nvidia's "fourth-best chip" in an interview with CNBC. He said it was in U.S. interests for Chinese firms to use American technology, even if the most advanced chips remained barred, to keep them on a U.S. "tech stack". Some elements of Trump's trade policy are already facing legal scrutiny, with a federal appeals panel skeptical of his claim that a 1977 law, traditionally used to sanction enemies or freeze assets, also empowered him to impose tariffs. "We aren't sure we like the precedent this sets," Bernstein analysts said of the revenue-share deal. "Will it stop with Chinese AI? Will it stop with controlled products? Will other companies be required to pay to sell into the region?" "It feels like a slippery slope to us." The analysts estimated the deal would cut gross margins on the China-bound processors by 5 to 15 percentage points, shaving about a point from Nvidia and AMD's overall margins. Nvidia generated $17 billion in revenue from China in the fiscal year ending January 26, representing 13% of total sales. AMD reported $6.2 billion in China revenue for 2024, accounting for 24% of total revenue. Nvidia has warned a China sales halt for H20 chips could cut $8 billion from July quarter revenue, while AMD has projected a $1.5 billion annual hit from the curbs.

Brazil-US meeting canceled amid tariff dispute, says finance minister
Brazil-US meeting canceled amid tariff dispute, says finance minister

Reuters

timean hour ago

  • Reuters

Brazil-US meeting canceled amid tariff dispute, says finance minister

SAO PAULO, Aug 11 (Reuters) - Brazil Finance Minister Fernando Haddad said on Monday that his virtual meeting with U.S. Treasury Secretary Scott Bessent had been canceled after initially being scheduled for Wednesday. That was a setback for the Brazilian government, which had hoped to use the meeting to negotiate tariffs after U.S. President Donald Trump's administration imposed 50% duties on several Brazilian goods. Speaking to GloboNews TV, Haddad said no new date had been set for the call, despite Brazil's request to reschedule it following the cancellation notice. The minister lamented that Brazil was not even able to sit at the table to negotiate tariffs with the United States and criticized what he called "pseudo-Brazilians" in Washington lobbying against their own country. The tariff hike was linked by the Trump administration to the trial of his right-wing ally, former President Jair Bolsonaro, who is facing charges over an alleged coup attempt following his 2022 electoral defeat. Congressman Eduardo Bolsonaro, Bolsonaro's son, has been in the U.S. since March, campaigning for sanctions against those responsible for the judicial proceedings. Haddad said Brazil will need to explore other markets more aggressively, highlighting Southeast Asia as a promising region and calling for urgent progress on a trade deal between South American bloc Mercosur and the European Union. The minister also said the government will soon issue an executive order to address the impact of higher U.S. tariffs. The package will include structural reforms to Brazil's export guarantee mechanisms through the Export Guarantee Fund (FGE). According to Haddad, the order will also support certain government purchases and credit measures, forming a multi-pronged response as there is no single solution for the roughly 10,000 companies affected.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store