British PM pledges support for auto industry, warning profound economic fallout from US tariffs

LONDON -- British Prime Minister Keir Starmer on Monday warned that newly imposed US tariffs on UK goods pose a serious threat to both the global economy and Britain's industrial base. He pledged urgent support for the domestic automotive sector in response to what he described as a changing world marked by "global instability."

Speaking at Jaguar Land Rover's (JLR) manufacturing plant in the West Midlands, Starmer called the situation "a moment of reckoning."

"Twenty-five percent tariffs on automotive exports, ten percent on other goods, this is a major challenge to our future. The global economic consequences could be profound," he cautioned.

"No one wins in a trade war. Nobody is pretending these tariffs are good news," he added, emphasizing that this is "a moment for cool heads."

Starmer's remarks came in the wake of JLR's announcement that it would temporarily halt shipments of UK-made vehicles to the United States. The month-long suspension, beginning Monday, will allow the company to assess the impact of the US tariffs and explore cost-mitigation strategies. With nearly a quarter of its 400,000 annual vehicle sales destined for the US market, JLR is among the hardest hit by the new trade barriers.

Industry data reveals that JLR earned 6.5 billion pounds (8.27 billion US dollars) in revenue from the US in the fiscal year ending March 2024, its most lucrative market. The company employs 38,000 workers in the UK and supports a vast supply chain throughout the West Midlands. Analysts have warned that if the tariffs remain in place, up to 25,000 jobs across the UK automotive industry could be at risk.

In response, the prime minister reaffirmed his government's determination to protect British industry. "These are challenging times, but we have chosen to come here because we are going to back you to the hilt," he told workers at the plant.

To help ease pressure on car manufacturers, Starmer announced a package of support measures, including increased flexibility in meeting electric vehicle (EV) production targets, a 20 percent reduction in fines for non-compliance, and an extension of the phase-out date for hybrid vehicles from 2030 to 2035.

Starmer stressed that any trade agreement must serve the UK's national interests, while vowing to broaden the country's international trade engagement beyond the US market.

"We're going to work with our key partners to reduce trade barriers globally, accelerate trade deals with other nations, and champion the cause of free and open trade around the world," he said. (1 pound = 1.29 US dollars)