LONDON, June 30 – Tariff cuts for the automotive and aerospace sectors have come into force after United Kingdom (UK) Prime Minister Keir Starmer finalised parts of a deal for relief from the United States’ (US) import taxes.
PA Media/dpa news reported that car manufacturers exporting to the US will face a 10 per cent tariff quota, down from 27.5 per cent, while the aerospace sector will see a 10 per cent levy removed entirely.
Starmer hailed the “historic trade deal” with the US, clinched after US President Donald Trump imposed import taxes as part of his “liberation day” tariffs on countries worldwide.
The Prime Minister and President finalised the deal for those sectors at the Group of Seven (G7) summit, but levies on steel have been left standing at 25 per cent rather than falling to zero as initially agreed.
Talks are ongoing to secure zero per cent tariffs on core steel products from the UK.
The executive order signed by Trump suggests the US wants assurances on the supply chains for UK steel intended for export, as well as on the “nature of ownership” of production facilities.
Starmer said: “Our historic trade deal with the United States delivers for British businesses and protects UK jobs.
“From today, our world-class automotive and aerospace industries will see tariffs slashed, safeguarding key industries that are vital to our economy.
“We will always act in the national interest – backing British businesses and workers, delivering on our Plan for Change.”
UK Business and Trade Secretary Jonathan Reynolds said the deal would save hundreds of millions each year and safeguard thousands of jobs.
“We agreed this deal with the US to protect jobs and support growth in some of our most vital sectors — and today, we’re delivering on that promise for the UK’s world-class automotive and aerospace industries.”
Aerospace trade association ADS head Kevin Craven said the sector “hugely appreciated” the efforts to reach a deal.
Society of Motor Manufacturers and Traders chief executive Mike Hawes said the agreement was “good news for US customers and a huge relief for the UK automotive companies that export to this critically important market.”
The government is also due to update parliament on Monday on ethanol and quotas on US beef.
Under the deal, it was agreed that a 20 per cent tariff on US beef imports to the UK would be removed and the quota for US beef raised to 13,000 metric tonnes.
A 19 per cent tariff on ethanol imports from the US is also due to be removed, with a tariff-free quota of 1.4 billion litres of US ethanol applied.
The bioethanol industry says the deal has made it impossible to compete with heavily subsidised US products.
Last week, the UK’s largest bioethanol plant warned that it could be weeks before it stops production.
Hull-based Vivergo Fuels said the start of talks with the government was a “positive signal” but that it was simultaneously beginning consultation with staff to wind down the plant.
