UK automakers are cautiously optimistic following a new trade deal with the United States, welcoming a step forward in transatlantic cooperation. But while the industry applauds easier access to American markets, there’s still an elephant in the room: steel tariffs.
A Trade Deal With Promise
The UK and US recently reached a mutual agreement that opens the door for stronger economic ties, with particular benefits for the automotive sector. After years of post-Brexit uncertainty, this deal marks a positive shift. It streamlines regulatory barriers, facilitates easier export flows, and boosts investor confidence.
For UK automakers, access to the US market is more than symbolic—it’s strategic. The US remains one of the largest export destinations for British-made vehicles. Automakers like Jaguar Land Rover, Mini, and Nissan UK are all poised to benefit.
Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT), said the deal is a “much-needed sign of progress” for a sector still recovering from Brexit and pandemic-related disruptions.
Steel Tariffs Still Cast a Shadow
Despite the positive headline, not all is resolved. Steel tariffs—first imposed by the Trump administration in 2018—remain in place, leaving UK manufacturers with higher production costs. The US has since lifted these tariffs for the EU, but the UK was left out of that arrangement.
For carmakers, the continued steel tariffs are more than an inconvenience. They directly impact bottom lines, especially as steel makes up a significant portion of vehicle manufacturing costs. This unfinished business is why many industry leaders see the current trade deal as only a partial win.
Why It Matters
The UK automotive industry employs over 180,000 people and contributes billions to the economy. Any friction in supply chains or added material costs—like those created by tariffs—hurts competitiveness.
With global players already pivoting to EV production, timing is everything. UK automakers want certainty, not half-measures.
What’s Next?
Talks are ongoing, but there’s no clear timeline for when—if ever—the US will lift steel tariffs for the UK. British officials have said they remain committed to resolving the issue. In the meantime, automakers are left to work around the uncertainty.
Final Thoughts
UK automakers cheer the US trade deal, yes—but they’re not popping the champagne just yet. Until steel tariffs are addressed, the celebration remains muted. A meaningful deal for the sector isn’t just about market access—it’s also about fair terms of trade.
