A seismic week for the global economy with President Trump outlining his long-promised tariff policy. Starting tomorrow, the UK, like many other countries, will face a 10% tariff – the minimum levied – on most exports across the Atlantic. Whilst charged less than other major economies, it is another deeply disappointing and potentially damaging measure, and will affect a wide range of automotive products. However, the most severe pain in our automotive sector is now likely to be felt by those attracting a 25% tariff on top of the existing duties, including car manufacturers and, from 3 May, the vast majority of car part suppliers.

We hope a deal between the UK and US can still be negotiated to reduce or even remove the tariff and recognise Government continues to work hard to secure such a deal. The industry is already facing multiple headwinds and this announcement comes at the worst possible time. SMMT is in constant contact with government and will be looking for trade discussions to accelerate as we need to secure a way forward that supports jobs and economic growth on both sides of the Atlantic.

A collaborative approach to both industrial and trade strategies will make the UK automotive industry stronger but so too does having thriving domestic vehicle markets. The UK’s new car registration figures, published today by SMMT, show a mixed picture. Last month’s ‘new numberplate’ March – the most important month of the year for the new car market – saw the highest demand of any March since 2019. It was also the best month ever for EV uptake, driven in part by some natural growth but also by unsustainable manufacturer discounting and shrewd buyers seeking to switch ahead of new tax disincentives. Even so, uptake was still less than 20% of the overall market, some eight percentage points behind the UK’s mandated targets for this year in what is the biggest volume month. Looking ahead, with the VED Expensive Car Supplement now applicable to BEVs, the market now faces further challenges just when we need every encouragement for consumers, particularly EV sceptics, to switch.

The new LCV market, meanwhile, declined for the fourth month running, amid weak business confidence to invest in fleet renewal. There was significant growth in new pick-up registrations, however, ahead of another negative fiscal measure, this time the change in tax treatment of double-cabs from commercial vehicles to cars for benefit in kind and capital allowance purposes. This will heap additional costs on businesses from 6 April, hitting industries making important contributions to national and local growth and risking further decline in the new LCV market – a barometer of UK economic health.

In this uncertain global trading landscape, SMMT’s forthcoming International Automotive Summit, taking place in London on 24 June, is more relevant than ever. It will provide a vital forum for more than 300 business leaders from automotive and aligned sectors, industry experts, national and international policymakers and the media to meet and discuss the challenges – and opportunities – our sector faces. Keynote speakers will be announced in the coming weeks, and delegate registrations are now open.