How a 25% Tariff Could Wipe Out Our Motor Industry and Leave an £18bn Black Hole!
Well, that escalated quickly.
Never a dull moment when Donald Trump is back in the big chair, eh? Just when we thought the UK motor industry might be clawing its way back from the brink – along comes a good old-fashioned trade shocker from across the pond.
On Wednesday, 26th March 2025, Trump dropped a bombshell: a blanket 25% import tariff on all foreign-built cars heading into the US. Yes, that includes British-built cars. So much for the Special Relationship.
Why This Matters (Spoiler: It’s BAD News)
In case you’re thinking, “Well, surely it’s not that bad?” – let me spell it out.
The USA is the UK’s number one car export destination by country – second only to the entire EU bloc. According to the SMMT, a whopping 17% of all UK car exports go to the United States.
We’re talking £5 billion+ worth of cars sent across the Atlantic every year. That includes the posh stuff – Range Rovers, Aston Martins, Bentleys, MINIs – the kind of cars Americans actually want. Well, used to.
Because now, with this 25% tariff, those cars just got a lot more expensive.
Let’s put that in perspective. A wealthy American buyer considering a Range Rover Autobiography might’ve paid around $150,000 before. Now? That jumps up to nearly $188,000. Even the 1% might start eyeing up a Cadillac Escalade instead.
And don’t forget the so-called everyday cars – like the MINI, built in Oxford. This tariff doesn’t discriminate – it hits all UK-built vehicles, high-end or humble.
Economic Disaster Incoming?
Now, let’s throw some extra misery into the mix. On the same day Trump made this announcement, we got our lovely little gift from the Chancellor – the Spring Budget 2025. And guess what? The UK’s growth forecast has just been halved. That’s right – from 2% to a paltry 1%.
And that’s before the Trump Tariff kicks in.
The Office for Budget Responsibility has already warned that the impact of this move could knock 0.6% off our GDP by 2026 – amounting to £18 billion lost from the UK economy. That’s not just a headline – that’s jobs, investments, and infrastructure… gone.
It’s not just numbers. It’s livelihoods.
Factories, Jobs & Investment – Under Threat
If US buyers turn away from UK cars – and let’s be honest, they will if prices shoot up – carmakers won’t just shrug and carry on. They’ll move. Some might shift production to the US. Others might simply pivot to other markets. Either way, it spells less production here in the UK.
That means:
• Fewer shifts on the factory floor.
• Less need for skilled labour.
• More jobs lost in communities that rely on car manufacturing.
And let’s not forget – the car industry is still the UK’s largest manufacturing export sector. It’s one of the last real heavyweights we’ve got. If that starts collapsing, so does everything around it – from supply chains to R&D.
Can We Do Anything?
The EU is already planning retaliatory tariffs, targeting $26 billion in US goods. But we’re no longer part of that gang. So what are we doing?
Well, UK Chancellor Rachel Reeves says we’re involved in “extensive talks” with the US to avoid this tariff being applied to British cars. Fingers crossed, yeah? Maybe Trump will remember that time we let him ride in the Queen’s golden carriage or something.
But knowing Trump? He doesn’t do anything unless there’s something in it for him. And he’s already threatened even larger tariffs against Canada and the EU if they try to fight back. This is shaping up to be an all-out trade war – and we’re caught in the crossfire.
Meanwhile, Guess Who’s Laughing?
The Chinese.
While the West is busy slapping tariffs on each other and kneecapping their own industries, Chinese carmakers are rubbing their hands together with glee. With fewer UK and EU cars in the US market, guess who stands ready to fill that void with cheaper EVs?
Trump says he’s protecting American jobs. But in reality, all he’s doing is handing the Chinese auto industry a massive gift.
And while he’s shooting himself in the foot (literally, in the cartoon version I just created), Britain is left mourning the slow death of its once-proud car industry.
Final Thoughts
This isn’t just a policy change. It’s potentially a turning point – for our car industry, our economy, and our international relationships. It could be catastrophic for British manufacturing, jobs, and consumer choice.
And let’s be honest – how much more can we take? We’ve barely recovered from Brexit, COVID, energy price shocks, and the cost-of-living crisis. Now this?
Unless Trump changes course – or the UK pulls off a last-minute diplomatic miracle – we’re in trouble. Big trouble.
Let me know what you think in the comments below.
Is this just posturing from Trump?
Can the UK negotiate its way out of this?
What will this mean for car fans and workers right here at home?
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