Trump And UK PM Starmer Agree To Tariffs

President Trump and UK Prime Minister Kier Starmer have signed an agreement that all but guarantees the UK will face a reduced tariff on its imported vehicles in the U.S. Previously, President Trump announced sweeping tariffs on imported vehicles, set at 25 percent. However, Trump has often played with figures and timelines. Initially, the tariffs were set for April first, with negotiations eventually resulting in a 90-day pause for further talks. Today, Starmer and Trump announced a 10 percent tariff on UK-imported vehicles, like Land Rover, coming into the US.

UK Imports Face 10 Percent Tariff In The US

As agreed upon last month, the first 100,000 UK-built cars that enter the US will be subject to a reduced tariff, but details are sparse. Autocar cites a US official who stated the “10 percent tariff – which brings it in line with the levy on other foreign goods – will apply to ‘100,000 cars.'” After that, it seems all other imports will be hit with a 25 percent tariff. Prior to Trump’s announcement, the tariff rate was 2.5 percent. However, Starmer has indicated he’s not done negotiating, saying in May that “we have scope now to increase that quota; this is not final.” Unfortunately, it still isn’t clear whether parts will be subject to the same agreement. While many vehicles are built in the US, significant numbers of parts are sourced from abroad, including from the UK and other countries, like China and Mexico.

More Details To Come

President Trump said during the announcement, which took place at the G7 summit in Canada, that he was “thrilled to announce a breakthrough trade deal. The agreement with one of our closest and most cherished allies.” It’s very likely that further details, such as specifics on tariffs for parts and the further 100,000+ vehicles, will be coming later. The President concluded his remarks by telling the media that “final details are being written up and will be detailed in the coming weeks.”

TopSpeed’s Take

The 10–25 percent tariff on UK imports is a huge blow, and one it seems the UK is not quite willing to accept. For now, the deal will at least give some automakers some clarity. Some, like Lotus, paused shipments altogether. Others, like Audi and more foreign manufacturers, have elected to have customers inherit the costs while their respective governments negotiate.

Source: Autocar