UK not ‘jumping into trade war’ with US, says Sir Keir Starmer

There will be no “jump into business war” with the US on Donald Trump’s plans to impose 25% import tax on cars entering the US, the Prime Minister said.

Sir Kir Stmper said that the government is trying to avoid tariffs, which is ready to come into force on 2 April, through the “intensive talks” with the US counterparts, the Sir Kir Stmper said.

There are concerns among PM’s comments that tariffs can increase global motor trade and supply chains, one of the largest UK-based exporters of the US, Jaguar Land Rover (JLR), one of the most affected manufacturers.

Trump has argued that measures would “tremend” for the car industry, promising that it will promote jobs and investment in the US.

But Sir Kir said that the tariffs were “very related”, saying that the government would be “practical and clear eyes” in its response.

“Industry does not want a business war, but it is important that we place all the options on the table,” he said.

The UK car exports about £ 7.6BN per year, and the US is the second largest market for the UK cars after the European Union, the Society of Motor Manufacturers and Traders (SMMT) according to the car industry body.

About 198,000 people are employed directly in the UK car industry, and it supports about 813,000 jobs in a comprehensive economy.

All major car manufacturers in the UK are foreign owners.

JLR, which is owned by the Indian group Tata Motors, said the company was “waiting for further information” on the tariff “.

Meanwhile, the founder of the car parts firm Unipart said that tariffs would push people around the world to buy Chinese -made cars.

The Trump administration has planned to impose 25% tax on import of cars from 2 April. Taxes on parts are determined to start May or later.

The latest step threatens to widen the global trade war and is part of the President’s campaign to protect American businesses and promote manufacturing within the US.

Tariffs are taxed on imported goods from other countries. Those costs can then be passed on consumers through higher prices, encouraging Americans to switch to US-made vehicles.

It can also force firms to manufacture and invest in the US. “If you manufacture your car in the United States, there is no tariff,” Trump said.

But this approach is questioned by many economists, who argue that it will increase inflation.

In the UK, SMMT stated that the tariff announced by Trump on Wednesday was “not surprising, but still, disappointing”, but called the two governments to make a deal.

Its Chief Executive Officer, Mike Hayes, said that “UK and US Auto Industries have long -running and productive relations, enjoying vehicles manufactured in Britain by some reputed brands, while thousands of UK motor drivers buy cars made in America”.

The UK government is interacting with the US administration and a business deal is expected before the tariff is implemented, the BBC understands.

John Neel, founder of Uniparte and former executive president of the firm, said Trump Tariff was “a gift for the Chinese car industry”, as international consumers would respond to a business war by purchasing Chinese options.

He said that tariffs could be “unexpected results”.

“Americans feel that they are excluding the world car industry from America, but the reality is that they are out of the world,” he said.

According to Ibisworld analyst Yusuf Elinson, the most exposed to JLR Trump’s tariff is the UK -based car firm.

He said that tariffs “infection represents severe threat to the UK car manufacturing sector”, as firms retal firms for electric vehicles.

Mr. Elinson said that it would be “extremely difficult” to find alternative markets for the UK car firms because “sector is saturated”.

“UK-made vehicles are already exported globally, so it would be a challenge to create a new demand to change the falling American versions,” he said.

He said that the UK could respond with an anti -anticipatory tariff on Tesla, which is currently the most popular electric vehicle sold in the UK, selling more than 50,000 cars per year.

Tesla, owned by Elon Musk, will not “unheard” by tariff, billionaire and Trump advisor Xe,

“The tariff effect on Tesla is still important,” he said.