U.S. President Donald Trump has signed an executive order confirming parts of a long-anticipated UK-US tariff agreement, reducing import duties on British-made cars and certain aerospace products while leaving steel tariffs untouched. The order follows weeks of negotiations and marks the first major trade-related announcement since the U.S. imposed sweeping new tariffs earlier this year.
Under the new order, the U.S. will allow up to 100,000 British vehicles to enter the country with a reduced 10% tariff, down from the previously imposed 25%. While the move is expected to ease pressure on the UK automotive industry, British steel exports remain subject to existing tariffs as the agreement falls short of comprehensive relief.
Speaking at the G7 summit in Canada, UK Prime Minister Sir Keir Starmer hailed the deal as a “very important day” for both nations. “This agreement implements key provisions on car tariffs and aerospace and is a sign of strength in the UK-US relationship,” Starmer said.
The limited pact, initially agreed in May, does not constitute a free-trade agreement and has drawn criticism from UK opposition leaders. Conservative Party leader Kemi Badenoch dismissed it as a “tiny tariff deal,” noting its narrow scope compared to broader trade arrangements with the EU or India.
President Trump defended the move, saying the UK is “very well protected” under the deal. “You know why? Because I like them,” he added, while declining to provide a timeline for lifting steel tariffs.
Industry stakeholders welcomed the reduced car tariff. Mike Hawes, CEO of the Society of Motor Manufacturers and Traders, said the decision offers “huge reassurance” to UK carmakers. “Exports to the U.S. had slowed as we waited for clarity. These are high-value, low-volume vehicles—not a threat to American production,” he told the BBC.
UK car shipments to the U.S. had previously faced a 2.5% tariff, but the recent hike to 25% threatened to severely impact exports. The revised 10% duty now gives UK manufacturers a slight competitive edge over rivals from countries like Germany and Italy, which remain subject to the full rate.
Meanwhile, the UK has agreed to raise import quotas for U.S. beef and ethanol, part of its commitments under the new arrangement. However, the UK government maintains that food safety standards will not be compromised.
Business and Trade Secretary Jonathan Reynolds called the agreement “the result of rapid coordination between both governments to ease burdens on British businesses.” He also confirmed upcoming updates to Parliament on the implementation of U.S. beef and ethanol quotas.
The deal is set to take effect seven days after its formal publication.
Written By Rodney Mbua
