Donald Trump's planned 25 per cent tariffs on US car imports could put around 25,000 UK automotive jobs at risk, according to a shocking new report.
The report warned that tariffs could place "extreme pressure" on Britain's car manufacturing industry, threatening both jobs and economic growth.
Workers at Jaguar Land Rover and the Cowley Mini factory were seen as among the most vulnerable carmakers to these changes, with the tariffs impacting one in eight UK-built cars currently exported to the US.
This represents a significant portion of Britain's automotive export market. The tariffs are expected to be confirmed by Trump today with experts warning this could create "an extraordinary challenge" for British vehicle manufacturers.
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Donald Trump signed the 25 per cent tariff on foreign car imports in March
REUTERS/PA
The potential job losses would significantly impact the Government's economic growth plans.However, the Institute for Public Policy Research report suggested that as "one door closes another one opens" with significant opportunities in green transport manufacturing.
Global sales of traditional internal combustion engine cars fell by 24 per cent between 2018 and 2022. During the same period, electric car sales soared by an astonishing 740 per cent.
The dramatic shift presents a potential lifeline for the UK automotive sector if it can capitalise on the transition to net zero.
Britain already has a strong foundation in this green transition, with over a third (35 per cent) of cars manufactured in the UK in 2024 being electric or hybrid models.
Many of these vehicles are exported, demonstrating the UK's existing capabilities in green transport production.This positions the country well to take advantage of growing global demand for electric vehicles, the expert explained.
The IPPR suggested the UK should "double down" on ensuring Britain remains competitive in zero or low emission transport products.
The UK currently has 4,938 firms in the transport manufacturing sector, employing 263,000 people with an annual turnover of £102.1billion.
Many of these companies already produce green transport products or can pivot in that direction. This existing industrial base could be redirected to offset potential losses from decreased US exports.
The transition would support both economic growth and climate objectives if properly supported.Beyond the export market, there is also significant potential in the domestic arena.
Car manufacturing in the UK is currently 2.5 times lower than car registration. This indicates a heavy reliance on importing vehicles from abroad. The IPPR argued that encouraging consumers to "buy British and buy green" could help close this gap.
Pranesh Narayanan, research fellow at IPPR, said: "Trump's tariffs have huge potential to completely destabilise the UK car manufacturing industry, affecting tens of thousands of jobs and putting the government's growth plans in jeopardy.
"However, as one door closes, another one opens. There is huge untapped potential in manufacturing green planes, trains and automobiles and selling them at home and abroad."
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The US tariffs could put 25,000 UK jobs at risk as the car manufacturing sector faces uncertainty
GETTY"If the Government use the upcoming industrial strategy to drive investment in these sectors, this could be the spark that leads to thousands of new consumers to start buying British and buying green," Narayanan added.