Tariff Deal Eases US Entry for British Cars

A new agreement between the United States and the United Kingdom will significantly alter the landscape for British car exports. This deal promises reduced tariffs, but comes with limitations and implications for the industry’s future.

The Core Agreement

Under the new arrangement, vehicles like the popular Range Rover SUVs will no longer face a 25% levy when entering the United States. The UK secured this unique agreement with the US. However, the deal has a significant caveat.

The agreement, as revealed by Starmer and Trump, allows 100,000 British cars to enter the US with a 10% tariff rate. Any vehicle exceeding that number will be subject to the original 25% duty.

“We agreed this deal with the US to ensure jobs and livelihoods in some of our most vital sectors were protected, and since then we have been focused on delivering those benefits to businesses,”

—Jonathan Reynolds, British Business and Trade Secretary

In the year leading up to the end of Q3 2024, UK car exports to the US were valued at over $12.2 billion (£9 billion). In 2024, the UK exported 761,000 cars to the US, a 4.3% rise year-on-year (SMMT, 2025).

Impact on the Automotive Industry

For car components, the agreement varies slightly. Parts made in the UK for use in UK cars will see tariffs decrease from 25% to 10%. Unlike vehicles, there is no quota for car parts.

The UK automaker Jaguar Land Rover, which exports nearly a quarter of its vehicles to the United States, previously stated that the agreement would provide “greater certainty for our sector.”

Jonathan Reynolds, the British Business and Trade Secretary, emphasized that this agreement will safeguard both UK workers and businesses.

This new arrangement represents a pivotal development for British car manufacturers, offering both opportunities and challenges as they navigate the US market.