US President Donald Trump has announced a new 25% tariff on all imported cars, threatening UK producers’ 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.
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14:42
Impact of US tariffs on UK industry
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.
There was swift condemnation of the latest threats, especially within countries worst affected in both volume and value terms including Mexico, Canada, South Korea and Germany.
The UK car industry also faces further damage from the tariffs at a time when it is already weakened by poor demand for new vehicles, domestically and abroad. Cheaper competition from China is also weighing heavily globally.
Manufacturers such as Jaguar Land Rover, Bentley, Aston Martin and Rolls-Royce stand to be worst affected.
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3:09
Ex-Aston boss fears tariff pain for UK firms
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.
Again, however, the UK government signalled it would not retaliate – mirroring its response to the tariffs on steel and aluminium imposed globally by the Trump administration earlier this month.
While chancellor Rachel Reeves condemned the fresh protectionism, she 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.”
The remark will be seen as a nod to continuing UK trade deal talks with the US.
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.
Image: Donald Trump announcing the 25% tariff on imported cars.
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.
“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.”
Lynn Calder, CEO of INEOS Automotive said: “This is what happens when politicians sit on their hands. As a growing EU-based automobile brand, we are vulnerable to tariffs, and we need our politicians to support our business, our jobs and our economies. We need urgent and direct political intervention on tariffs.
“Fortunately, we have been planning for tariffs but there is only so much we can do to protect US customers from price rises.”
Questions have been raised over extreme weather warnings in Texas, after heavy rain caused fatal flash floods along the Guadalupe River.
At least 51 people have died from the flooding in Texas, with an unknown number of people – including 27 girls from Camp Mystic in Kerr County – still missing.
As rescue teams continue to search for the missing, local and federal officials have come under fire over their flood preparations and about why those along the river weren’t warned of the risks sooner.
Image: A map showing the Guadalupe River in Kerr County, which burst from heavy rain and caused flash flooding
Image: Campers embrace at a reunification area. Pic: Jason Fochtman/Houston Chronicle via AP
What happened?
As much as 10ins (25cm) of heavy rain fell in just a few hours overnight in central Kerr County on Friday, causing the banks of the Guadalupe River to burst at around 4am local time.
Homes and vehicles were swept away by the downpour – equivalent to months’ worth of rain – while 27 girls staying at Camp Mystic, a Christian summer camp along the river, went missing when the fast-rising floodwaters hit.
The death toll stands at: • At least 43 people, including 15 children and 28 adults, in Kerr County, • One person in Kendall County, • At least four people in Travis County, • At least two in Burnet County, • And one person in the city of San Angelo.
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1:20
House sweeps away in flash floods
What flood warnings were there?
Private forecasting company AccuWeather said it and the National Weather Service (NWS) sent warnings about potential flash flooding hours before it began, urging people to move to higher ground and evacuate flood-prone areas.
The NWS also issued flash flood emergencies – a rare alert notifying of imminent danger – at 4.23am local time.
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In a statement, AccuWeather said that “these warnings should have provided officials with ample time to evacuate camps such as Camp Mystic and get people to safety”.
It also called Texas Hill County one of the most flash-flood-prone areas of the US because of its terrain and many water crossings.
However, chief of the Texas Division of Emergency Management Nim Kidd said that one NWS forecast earlier in the week had called for up to six inches of rain.
“It did not predict the amount of rain that we saw,” he said.
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3:35
Texas searches for missing children
Were they enough?
Locals have told various news agencies that while there had been phone alerts late into the night, forecasts headed into Friday evening did not predict the extreme conditions.
Christopher Flowers, who was staying at a friend’s house along the river when the flooding started, told the Reuters news agency: “What they need is some kind of external system, like a tornado warning that tells people to get out now.”
Kerrville resident Darryl Huffman told Sky’s US partner network NBC News that he did not believe the storm would pose such danger before its arrival.
“I looked out the window and it was barely sprinkling outside,” he said, “so I had no indication that the river was going to be right outside my driveway”.
Image: People climb over debris on a bridge atop the Guadalupe River in Ingram, Texas. Pic: AP
Image: A Sheriff’s deputy pauses while searching for the missing in Hunt, Texas. Pic: AP/Julio Cortez
Jonathan Porter, chief meteorologist at AccuWeather, said it appeared evacuations and other proactive measures could have been undertaken to reduce the risk of fatalities.
He said in a statement: “People, businesses, and governments should take action based on Flash Flood Warnings that are issued, regardless of the rainfall amounts that have occurred or are forecast.”
Separately, the NWS’s union told NBC News the agency’s offices in central Texas were well-staffed and had issued timely warnings, “giving preliminary lead times of more than three hours before warning criteria were met”.
What have officials said?
Local and federal officials have said they had not expected such an intense downpour of rain and insisted that no one saw the flood potential coming.
Kerr County Judge Rob Kelly, the county’s top elected official, said: “We know we get rain. We know the river rises. But nobody saw this coming.”
“We have floods all the time. This is the most dangerous river valley in the United States,” he said, adding: “We had no reason to believe this was going to be anything like what’s happened here. None whatsoever.”
Mr Kelly separately noted that while the county considered a flood warning system along the river that would have functioned like a tornado warning siren about six or seven years ago, “the public reeled at the cost”.
At a news conference with the Texas governor, Homeland Security secretary Kristi Noem said on Saturday that “everybody knows that the weather is extremely difficult to predict” before saying “we have all wanted more time and more warning and more alerts and more notification” from the NWS.
She said a “moderate” flood watch issued on Thursday by the NWS had not accurately predicted the extreme rainfall and said the Trump administration was working to upgrade their technology.
Image: Kristi Noem and Texas governor Greg Abbott give a news briefing. Pic: AP
Will forecasting get better?
While Ms Noem said technology for the NWS would be upgraded, the White House has previously been criticised after Donald Trump‘s administration ordered 800 job cuts at the National Oceanic and Atmospheric Administration (NOAA) – the parent organisation of the NWS.
A 30% cut to its budget is also in the pipeline, subject to approval by Congress.
Professor Costa Samaras, who worked on energy policy at the White House under President Joe Biden, said NOAA had been in the middle of developing new flood maps for neighbourhoods and that cuts to NOAA were “devastating”.
At least 51 people have died after heavy rain caused flash flooding, with water bursting from the banks of the Guadalupe River in Texas.
The overflowing water began sweeping into Kerr County and other areas around 4am local time on Friday, killing at least 43 people in the county.
This includes at least 15 children and 28 adults, with five children and 12 adults pending identification, Kerr County Sheriff Larry Leitha said at a news conference.
In nearby Kendall County, one person has died. At least four people were killed in Travis County, while at least two people died in Burnet County. Another person has died in the city of San Angelo in Tom Green County.
Image: People comfort each other in Kerrville, Texas. Pic: Jason Fochtman/Houston Chronicle via AP
Image: Large piles of debris in Kerrville, Texas, following the flooding. Pic: Reuters//Marco Bello
An unknown number of people remain missing, including 27 girls from Camp Mystic in Kerr County, a Christian summer camp along the Guadalupe River.
Rescuers have already saved hundreds of people and would work around the clock to find those still unaccounted for, Texas governor Greg Abbott said.
But as rescue teams are searching for the missing, Texas officials are facing scrutiny over their preparations and why residents and summer camps for children that are dotted along the river were not alerted sooner or told to evacuate.
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AccuWeather said the private forecasting company and the National Weather Service (NWS) sent warnings about potential flash flooding hours before the devastation, urging people to move to higher ground and evacuate flood-prone areas.
Image: Debris on the banks of the Guadalupe River in Hunt. Pic: AP Photo/Julio Cortez
Image: An overturned vehicle is caught in debris along the Guadalupe River. Pic: AP
The NWS later issued flash flood emergencies – a rare alert notifying of imminent danger.
“These warnings should have provided officials with ample time to evacuate camps such as Camp Mystic and get people to safety,” AccuWeather said in a statement that called Texas Hill County one of the most flash-flood-prone areas of the US because of its terrain and many water crossings.
But one NWS forecast earlier in the week had called for up to six inches of rain, said Nim Kidd, chief of the Texas Division of Emergency Management.”It did not predict the amount of rain that we saw,” he said.
Officials said they had not expected such an intense downpour of rain, equivalent to months’ worth in a few short hours, insisting that no one saw the flood potential coming.
One river near Camp Mystic rose 22ft in two hours, according to Bob Fogarty, meteorologist with the NWS’s Austin/San Antonio office. The gauge failed after recording a level of 29.5ft.
Image: A wall is missing on a building at Camp Mystic in Hunt, Texas. Pic: AP/Julio Cortez
Image: Bedding items are seen outside sleeping quarters at Camp Mystic. Pic: AP/Julio Cortez
Image: A Sheriff’s deputy pauses while searching for the missing in Hunt, Texas.Pic: AP/Julio Cortez
“People, businesses, and governments should take action based on Flash Flood Warnings that are issued, regardless of the rainfall amounts that have occurred or are forecast,” Jonathan Porter, chief meteorologist at AccuWeather, said in a statement.
“We know we get rain. We know the river rises,” said Kerr County Judge Rob Kelly, the county’s top elected official. “But nobody saw this coming.”
Judge Kelly said the county considered a flood warning system along the Guadalupe River that would have functioned like a tornado warning siren about six or seven years ago, before he was elected, but that the idea never got off the ground because “the public reeled at the cost”.
Image: A drone view of Comfort, Texas. Pic: Reuters
Image: Officials comb through the banks of the Guadalupe River in Hunt, Texas. Pic: AP/Julio Cortez
Homeland Security Secretary Kristi Noem was asked during a news conference on Saturday whether the flash flood warnings came through quickly enough: “We know that everyone wants more warning time, and that is why we are working to upgrade the technologies that have been neglected for far too long.”
Presidential cuts to climate and weather organisations have also been criticised in the wake of the floods after Donald Trump‘s administration ordered 800 job cuts at the science and climate organisation NOAA, the parent organisation of the NWS, which predicts and warns about extreme weather like the Texas floods.
A 30% cut to its budget is also in the pipeline, subject to approval by Congress.
Professor Costa Samaras, who worked on energy policy at the White House under President Joe Biden, said NOAA had been in the middle of developing new flood maps for neighbourhoods and that cuts to NOAA were “devastating”.
“Accurate weather forecasts matter. FEMA and NOAA matter. Because little girls’ lives matter,” said Frank Figliuzzi, a national security and intelligence analyst at Sky’s US partner organisation NBC News.
Musk had previously said we would form and fund a new political party to unseat lawmakers who supported the bill.
From bromance to bust-up
The Tesla boss backed Trump’s election campaign with more than a quarter of a billion dollars, later rewarded with a high profile role running the newly created department of government efficiency (DOGE).
Image: Donald Trump gave Musk a warm send-off in the Oval Office in May. Pic: Reuters
In May Musk left the role, still on good terms with Trump but criticising key parts of his legislative agenda.
After that, the attacks ramped up, with Musk slamming the sweeping tax and spending bill as a “disgusting abomination” and Trump hitting back in a barbed tit-for-tat.
Trump earlier this week threatened to cut off the billion-dollar federal subsidies that flow to Musk’s companies, and said he would even consider deporting him.