Sir Keir Starmer has pledged that British manufacturers will lead the way in the electric vehicle transition, as the Government prepares a series of reforms to shield the sector from new US trade tariffs. The Prime Minister described the automotive industry as “the engine room of British industry” and said the Government must now move “further and faster” to support firms in this “new era of global instability”. His plans include relaxing penalties on carmakers who fall short of electric vehicle sales quotas and exempting low-volume supercar producers like Aston Martin and McLaren from certain rules.
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The measures come in response to tariffs introduced by US President Donald Trump, who has slapped a 25% duty on imported vehicles and a 10% levy on other goods. Jaguar Land Rover has already announced a temporary halt on shipments to the US as it reassesses its trade strategy. As part of the UK’s response, the 2030 ban on the sale of new petrol and diesel cars will be reinstated, though some flexibility will be introduced. Hybrids and plug-in hybrids will remain on sale until 2035, and exemptions will be made for limited-production supercars. Levies for failing to meet electric vehicle sales targets will also be eased.
Sir Keir, writing in The Times, confirmed that this is “just the first in a series” of government announcements intended to provide certainty and confidence to industry and workers. Over the weekend, he spoke with several foreign leaders — including Ursula von der Leyen and Olaf Scholz — to express concern over the US tariffs. He reaffirmed the UK’s commitment to defending its national interest and promoting fair global trade. Meanwhile, Germany, one of the main targets of the US measures, is preparing for increased duties of up to 20%.
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Industry bodies have warned that more decisive action may be required to protect the UK automotive sector. Mike Hawes of the Society of Motor Manufacturers and Traders stressed the importance of rapid negotiations with the US and the urgent delivery of a national industrial strategy. However, the Government has come under fire from opposition parties. The Conservatives accused Labour of being slow to act, while the Liberal Democrats criticised the limited scope of the new policies, calling for consumer incentives such as VAT cuts on public EV charging and a delay to planned tax increases on electric vehicles. Mr Trump, speaking from Air Force One, said countries must reduce their trade surpluses with the US and that his actions were necessary to correct what he views as unfair deficits.
