UK strikes major trade deal with US, easing tariffs for carmakers and steel exporters

TDT | agencies

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Just days after finalising a free trade agreement with India, the United Kingdom has reached a new trade deal with the United States—bringing welcome news for British carmakers.

Under the agreement, the first 100,000 vehicles exported annually to the US by UK manufacturers will face a reduced tariff of 10%. Any exports beyond that limit will be subject to a higher 25% rate.

While iconic brands like Jaguar Land Rover, Mini, RollsRoyce, Bentley, McLaren, and Lotus collectively surpass the 100,000-unit threshold, not all of their vehicles are manufactured in the UK. In 2024, vehicle exports to the US reached 100,000 units, valued at around $12 billion, according to the BBC.

In a related announcement, the US confirmed that a new trading framework for steel and aluminium is in place. Tariffs on UK steel, previously set at 25%, have now been scrapped— allowing British producers to resume duty-free exports across the Atlantic.

The UK government described the deal as a “historic agreement” that will “slash tariffs” for carmakers, steel manufacturers, and farmers, while helping safeguard jobs and provide certainty for exporters. It added that reducing car export tariffs from 27.5% to 10% could save “hundreds of millions of pounds a year for Jaguar Land Rover alone.”