Latest news with #Britishcars
The Guardian
3 days ago
- Automotive
- The Guardian
UK officials hopeful that US will start lifting car tariffs this week
UK officials are hopeful the US will begin lifting tariffs on British cars as soon as this week after the British trade secretary meets his US counterpart in London. Jonathan Reynolds is due to meet Howard Lutnick, the US commerce secretary, on Tuesday evening to discuss the deal to lower US tariffs on cars, steel and aluminium. Downing Street is hopeful that the implementation of the deal will begin this week, according to two people with knowledge of the discussions. The aim is to secure a proclamation from Donald Trump this week that would kickstart its implementation, a government official with knowledge of the process said. The US commerce department would then be tasked with enforcing the tariff reductions on UK goods. Officials expect tariffs on British cars to be reduced first because the process is less complex than with aluminium and steel, according to the two people briefed on progress in the talks. Trump and Keir Starmer announced a 'historic' trade agreement last month that promised relief for key British industries affected by US import taxes. Trump agreed to reduce his 25% aluminium and steel tariffs to zero and slash his 25% tariff to 10% for up to 100,000 British cars a year. Two weeks ago Trump doubled US tariffs on steel and aluminium to 50% but said the UK would stay at the 25% rate until 9 July, pending enforcement of the deal and assuming that the British government 'complies with relevant aspects'. Ministers and negotiators are now racing to thrash out the details before that deadline. A trade department source stressed that the government could not predict the actions of the US administration. The UK is the only country so far that has struck an agreement with the US, though businesses have yet to feel its benefits. Starmer told MPs last Wednesday that he hoped the agreement with the US could come into effect 'in just a couple of weeks'. Cars are the UK's biggest export to the US, worth about £9bn last year. The value of the UK's steel and aluminium exports is much smaller, at about £700m a year, but the US is an important market for them. Sign up to First Thing Our US morning briefing breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion One of the remaining questions for British ministers is how the quota of 100,000 cars will be allocated. Options include a free-for-all system until the quota is met, splitting it into 25,000 car exports a quarter, or earmarking a certain number of exports for small and medium-sized manufacturers. One issue the US government is concerned about is steel from other countries being processed in the UK and then exported to the US at a 0% tariff. This has triggered fears that the deal could end up excluding the UK's biggest steelmaker, Indian-owned Tata Steel, because of the origin of some of its products. Lutnick is in London for trade talks with China that aim to resolve mounting tensions between the world's two largest economies. Washington and Beijing agreed a temporary truce over tariffs last month but each country has since accused the other of breaching the deal.
ABC News
08-05-2025
- Business
- ABC News
US and UK strike trade deal as Trump slashes tariffs on British steel and cars
Donald Trump has agreed to slash US tariffs on British cars and steels as part of a "historic" trade deal between America and the UK. The agreement is the first to be announced since Mr Trump triggered a global trade war with a barrage of levies on trading partners after his return to the White House in January. The joint announcement by the US president and UK Prime Minister Keir Starmer was made on the 80th anniversary of VE Day, when the two countries fought side-by-side to defeat Nazi Germany. The pact, which is expected to save thousands of jobs in British industry threatened by the Trump administration's tariff agenda, will see tariffs on steel and aluminium exports from Britain to the US cut from 25 per cent to zero. In addition, tariffs on an annual quota of 100,000 British cars sold to the US will be cut from 27.5 per cent to 10 per cent. Britain, meanwhile, agreed to lower its tariffs to 1.8 per cent from 5.1 per cent and provide greater market access to US goods. The 10 per cent "baseline" tariff, placed on most of America's trading partners on so-called "liberation day" last month, remains in place. "It opens up a tremendous market for us," Mr Trump said during a teleconference, which was broadcast on Thursday, local time. "This is a really fantastic, historic day," Sir Keir said by teleconference. The US has been under pressure from investors to strike deals to de-escalate its tariff war after Mr Trump's often chaotic policymaking up-ended global trade with friends and foe alike, threatening to stoke inflation and start a recession. Top US officials have engaged in a flurry of meetings with trading partners since the president on April 2 imposed a 10 per cent tariff on most countries, along with higher rates for many trading partners that were then suspended for 90 days. The US has also imposed 25 per cent tariffs on autos, steel and aluminium, 25 per cent tariffs on Canada and Mexico, and 145 per cent tariffs on China. US and Chinese officials are due to hold talks in Switzerland on Saturday. With the British economy struggling to grow, the tariffs had added to the pressure on Sir Keir's government. Jaguar Land Rover had paused its shipments to the US for a month and the government was forced to seize control of British Steel to keep it operating. While seeking a deal with the US, Britain had refused to lower its food standards, which are closely aligned with the European Union. However, Britain's farming trade union has said that some US producers who do not use growth hormones or antimicrobial washes could be given greater market access. The UK government has been seeking to build new trading relationships post-Brexit with the US, China and the EU without moving so far towards one bloc that it angers the others. There are also domestic political risks. Polling shows the government remains deeply unpopular, making any move to cut taxes on multi-national tech companies a big risk. Britain's digital service tax, levied at 2 per cent of UK revenue for online marketplaces, search engines and social media platforms, was introduced in 2020 in response to an outcry about tax avoidance by big tech. It will continue unchanged.
