Carmakers mull action over tariffs as Jaguar Land Rover pauses car exports to US

Jaguar Land Rover will pause all shipments to the US. This decision comes as they address new trading terms after recent tariffs.

A 25% tariff on car imports started on Thursday. This is part of several measures announced by President Donald Trump. These changes have shocked global supply chains.

The US is the second-largest export market for the UK's car industry, following the European Union. A Jaguar Land Rover spokesperson stated they are taking short-term actions, including a shipment pause in April. They are developing mid to long-term plans.

Jaguar Land Rover has sites in Coventry, Solihull, and Wolverhampton. The US is an important market for JLR's luxury brands. More cars are exported to the US from the UK than any other goods.

In a year ending in Q3 2024, this trade was worth £8.3 billion, according to the UK trade department. Initial tariffs on cars began on April 3rd, with import taxes on auto parts coming next month.

Nissan is considering moving some production of US-bound vehicles from Japan to the US this summer. Earlier this week, Nissan decided to keep two production shifts at its Tennessee plant after scaling back operations in January.

Carmaker Stellantis will temporarily shut down its assembly plant in Windsor next week due to new tariffs. The United Auto Workers union supports these tariffs, stating they prioritize workers over corporate greed.

A separate 10% tariff will apply to all other UK imports, with higher rates for some major economies. Global stock markets have faced heavy losses as companies adapt to these changes.

The FTSE 100 dropped by 4.9% on Friday, its largest fall since the pandemic began. Exchanges in Germany and France also experienced similar declines.

Sir Keir Starmer said the UK will take a calm approach to trade tariffs and avoid a trade war. He acknowledged that "the world as we knew it has gone." However, he is ready to use industrial policy to protect British businesses.

In an article for the Sunday Telegraph, Sir Keir expressed his desire for a trade deal with the US to reduce some tariffs. He also mentioned potential state intervention for national interests.

Sir Keir is discussing responses with other European leaders regarding White House trade moves. He spoke with French President Emmanuel Macron on Saturday as part of ongoing discussions over the weekend.

Downing Street reported that Sir Keir and Macron agreed that "a trade war was in nobody's interest," but emphasized that "nothing should be off the table."