British construction equipment manufacturer JCB has announced plans to double the size of its new factory in Texas in response to Donald Trump's tariffs on UK imports.
Although currently under construction, the company confirmed it will expand the facility from 500,000 to one million square feet.
The decision comes after the US President imposed a 10 per cent tariff on British goods, which JCB said would significantly impact its business in the short term.
JCB has been manufacturing in the US for 50 years and last year purchased 400 acres of land in San Antonio.
JCB's headquarters in Staffordshire
PA
The new $500million plant is due to start production next year and will employ up to 1,500 people.
The expansion will build on JCB's growth in North America, where the company's existing manufacturing plant in Savannah, Georgia, has operated for 25 years.
The Savannah facility currently employs around 1,000 people.
JCB has recognised the need to produce even more machines in North America, which is the largest market for construction equipment in the world.
JCB Chairman Anthony Bamford said: "JCB has been in business for 80 years this year and we are well accustomed to change.
"The United States is the largest market for construction equipment in the world and President Trump has galvanised us into evaluating how we can make even more products in the USA, which has been an important market for JCB since we sold our first machine there in 1964."
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Lord Bamford's announcement marks JCB as the first major British manufacturer to bolster its US operations in direct response to the new tariffs.
The company remains headquartered in Staffordshire, with 11 plants in the UK employing 8,000 people.
JCB chief executive Graeme Macdonald added: "In the short term, the imposition of tariffs will have a significant impact on our business."
"However, in the medium term, our planned factory in San Antonio will help to mitigate the impact.
"We are thankful that the tariff is only 10 per cent and we can only hope that the UK Government will conclude negotiations on a trade deal in the coming days and weeks."
JCB has 11 plants in the UK and employs 8,000 people
PA
Trump's tariffs, which came into effect yesterday, are designed to protect domestic manufacturing and boost American jobs.
British manufacturers have urged Sir Keir Starmer to move quickly to strike a deal with the US on free trade to lessen the impact of the new levies.
The president has already handed the UK lower tariffs than much of the rest of the world, something that has been hailed as a "Brexit dividend".
Senior executives from several industries were invited to a meeting at Downing Street yesterday morning to be briefed on the Government's next steps.
The Prime Minister has said he will continue to engage with businesses and seek an economic deal with the US to reduce the impact of the tariffs.
The news US factory is due to start production next year
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Mike Hawes, the chief executive of the Society of Motor Manufacturers and Traders, said: "If you could negotiate some sort of economic agreement that gives us a competitive advantage compared to other manufacturing locations, that could be a real benefit."
Kevin Craven, chief executive of ADS, the trade group for aerospace, defence and space sectors, was optimistic about Britain's position.
"We are better off than Europe today and our Government and officials are reasonably positive about improving the better position that we have," he said.
Other manufacturers are already feeling the impact of the tariffs, with Stellantis temporarily halting work at factories in Canada and Mexico.
A Downing Street spokesman said JCB's expansion was a commercial decision but added: "Our approach to business is to engage, to listen and to act in a pragmatic way."
"Although we recognise that the UK is in a relatively more favourable position than other countries, the impact on the UK will be real."
The spokesman added the government was focused on "working with businesses to analyse the impacts of this decision and to continue to work with the US to lower trade barriers".
