US President Donald Trump has announced a new 25% tariff on all imported cars, threatening UK producers in their largest single export market.

Signing an executive order, Mr Trump said the tax would kick in on 2 April – what he has called “liberation day”.

This is when all his retaliatory import tariffs are supposed to take effect, but they have been delayed before.

The move ratchets up the global trade war Mr Trump himself kicked off at a time when his administration is battling the continued fallout from the Signalgate security breach in Washington.

Speaking late on Wednesday, Mr Trump said the proposal: “Will continue to spur growth. We’ll effectively be charging a 25% tariff.”

Similar duties on all car part imports are expected to follow in May, complicating the effects as even American car makers source components from around the world – meaning they could also face higher costs and lower sales.

The UK government has signalled it will not retaliate – mirroring its response to the tariffs on steel and aluminium imposed globally by the Trump administration earlier this month.

Chancellor Rachel Reeves condemned the protectionism but told Sky’s Wilfred Frost: “We’re not at the moment in a position where we want to do anything to escalate these trade wars,” in what will be seen as a nod to continuing UK trade deal talks with the US.

But the threat risks a huge impact for the country’s car industry, including manufacturers such as Jaguar Land Rover, Aston Martin and Rolls-Royce.

Official data shows that the US is the UK car sector’s largest single market by country, accounting for £6.4bn worth of car exports in 2023. That is 18.4% of the total.

Listed European car and car parts manufacturers saw further steep declines in their share prices in Thursday trading as the plans drew widespread international criticism.

Canadian Prime Minister Mark Carney called it a “direct attack” on Canadian workers.

Even Trump advisor Elon Musk, the Tesla boss, admitted in a post on his X platform that the hit to his company would be “significant”.

During his second term, Mr Trump has used tariffs frequently as a trade weapon.

He cited plans from South Korean car maker Hyundai to build a $5.8bn (£4.5bn) steel plant in Louisiana as evidence the economic measures would bring back manufacturing jobs.

Even American and foreign firms already with domestic plants still rely on Canada, Mexico and other countries for parts and finished vehicles – meaning prices could increase and sales decline as new factories take time to build.

Tariffs are a key part of Mr Trump’s efforts to reshape global trade relations.

He plans to impose what he calls “reciprocal” taxes on 2 April that would match tariffs and sales taxes levied by other nations.

He has already placed a 20% tax on all imports from China.

Similarly, he placed 25% tariffs on Mexico and Canada, with a lower 10% tariff on Canadian energy products in addition to the duties on all steel and aluminium imports, including those from the UK.

Sky News understands the UK government is continuing to engage with the US on a trade deal and remains hopeful an agreement could be made before the tariffs come into force, but may retaliate if deemed necessary at a later date.

Mike Hawes, the chief executive of the UK car industry lobby group the SMMT, said: “Today’s announcement by President Trump is not surprising but, nevertheless, disappointing if, as seems likely, additional tariffs are to apply to UK made cars.

Read more:
What are Trump’s tariffs and how will they affect the UK?
Atlantic publishes more texts from group chat
JD Vance announces trip to Greenland

“The UK and US auto industries have a long-standing and productive relationship, with US consumers enjoying vehicles built in Britain by some iconic brands, while thousands of UK motorists buy cars made in America.

“Rather than imposing additional tariffs, we should explore ways in which opportunities for both British and American manufacturers can be created as part of a mutually beneficial relationship, benefitting consumers and creating jobs and growth across the Atlantic.

“The industry urges both sides to come together immediately and strike a deal that works for all.”

Marjorie Taylor Greene has become the most aggressive spokesperson for the “Make America Great Again” movement.

It’s perhaps no surprise, then, that she would read straight from a fraying playbook when confronted about the Signal group chat fiasco.

Team Trump has adopted a crisis management strategy of attack, discredit, and distract, a dark art of which Taylor Greene is emerging as a master.

When questioned about whether the texts on the group chat, detailing timings and weapons to be used on strikes on Houthis in Yemen, amount to classified information, she refused to answer the question.

Read more here:
More details of US security breach revealed
Atlantic publishes more texts shared on leaked chat

The representative from Georgia attempted to deflect attention on to the Biden administration, then on to the US’s border problem and finally, in a remarkable act of contortion, on to “all the women that are raped by migrants” in the UK.

Refusing to answer a question from Sky News, she then turned to a question from a US reporter, who also asked for clarification on her views about the Signal scandal and its national security ramifications.

👉 Follow Trump 100 on your podcast app 👈

Eventually, Taylor Greene did respond to The Atlantic magazine’s revelation of texts on the signal group chat, fully backing defence secretary, Pete Hegseth, who is facing calls for his resignation.

In MAGA world, the villain of this scandal is Jeffrey Goldberg, the editor of The Atlantic, who was inadvertently invited on to the group chat.

Despite the fact that Goldberg took care over his reporting and potentially exposing major failings in the way senior government communicate, he has been repeatedly smeared by the White House.

Donald Trump calls him a “sleazebag”, national security advisor Michael Waltz equates him to “journalists trying to make a name for themselves”, and press secretary Karoline Leavitt calls him an “anti-Trump hater.”

Discrediting the messenger, rather than focusing on the message and what lessons can be learned, is the order of the day for the Trump White House.

👉 Follow Trump 100 on your podcast app 👈

The Atlantic has published the full Signal messages at the heart of the growing security scandal, revealing strike timings, military coordination, and the accidental inclusion of journalist Jeffrey Goldberg.

On Day 67, US correspondents James Matthews and Martha Kelner unpack why Goldberg was already unpopular with Trump, and what this episode says about the people driving American military and political decision-making.

Plus, Martha is confronted by Republican representative Marjorie Taylor Greene, who praises defence secretary Pete Hegseth… and tells Martha to “go back to your own country”.

If you’ve got a question you’d like James, Martha, and Mark to answer, you can email it to trump100@sky.uk.

Help us understand more about our listeners by taking our survey! 👉 This form 👈 should only take a few minutes to complete, and Sky anonymises the responses as much as possible. Thank you.

Don’t forget, you can also watch all episodes on our YouTube channel.