Drivers have been warned they could face huge price hikes for popular vehicles as manufacturers face significant challenges from Donald Trump's 25 per cent auto tariffs.
The levy, which remains in place despite a 90-day pause on other reciprocal tariffs against trading partners, has already forced brands to adjust their strategies, with many brands warning they will need to raise prices as a result.
The UK car industry is particularly vulnerable, with one in six exported cars heading to the US market, making it especially crucial for brands such as Jaguar Land Rover, Bentley, and McLaren.
In response to the tariff, Jaguar Land Rover has already suspended all US shipments for a month. Meanwhile, Aston Martin has indicated it will pass on some of the costs to consumers while seeking to minimise the impact through various measures.
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Luxury car brands have responded to Trump's tariffs by pausing shipments of vehicles and increasing prices
GETTY/ASTON MARTIN
Morgan Motor, another British manufacturer, plans to split the burden with customers, passing on about half of the tariff costs to US buyers. This means its $85,000 (£64,000) Plus Four model would cost 10 per cent more for UScustomers.
Ferrari has already announced a 10 per cent price increase for some of its models, although pricing for the Ferrari 296, SF90, and Roma families will remain unchanged.
But industry analyst Scott Sherwood warned the impact extends beyond US sales, with potential consequences for the entire global market.
He told the Financial Times: "For customers, it's inevitably going to lead to higher prices. There is a very high probability of job losses on both sides of the Atlantic."
The impact could be felt by UK consumers as manufacturers spread the financial hit across their entire customer base, he detailed.
According to the Institute for Public Policy Research, more than 25,000 direct jobs in the UK car manufacturing industry could be at risk if exports to America fall.
Pranesh Narayanan, research fellow at the institute, warned that 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".
Meanwhile, Aston Martin has taken several measures to minimise the impact of the tariffs, including invoicing all stock that landed in the US in March.
The company has also reduced shipments in April to avoid suspending them completely.To strengthen its financial position, Aston Martin announced plans to raise more than £125million by selling its minority stake in its Formula 1 racing team.
Despite these efforts, the company still expects to lose roughly £30million in gross profit from the tariffs. "We anticipated some risks in the plan and built in contingencies," said Aston Martin chief executive Adrian Hallmark.
He added: "This now makes it tighter to hit what we promised, but we're not fundamentally changing our guidance or forecasts as a result of the tariffs."
Ferrari's approach differs, with the company and its dealers likely to absorb the full cost of the tariffs for some models while increasing prices by 10 per cent for others.
LATEST DEVELOPMENTS:
Donald Trump confirmed that a 25 per cent tariff would apply to all foreign car importsREUTERS"Does anyone really want a Ferrari that isn't built in Maranello?" Sherwood noted, suggesting the strongest luxury marques can rely on customer loyalty.
