Why Jaguar Land Rover ‘cannot discount’ building cars in US in response to Trump tariffs
Jaguar Land Rover has said it “cannot discount” starting manufacturing in the US in response to President Donald Trump's tariffs on carmakers despite the new UK-US trade deal.
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However, the company which employs thousands of workers in the West Midlands said it currently has “no immediate plans” to shift production from the UK and Europe.
It came as bosses at the car giant, which is headquartered in Coventry with sites in Wolverhampton, Solihull and Castle Bromwich, said it witnessed an expected dip in sales volumes in late April and early May after increasing activity earlier this year in preparation for potential tariffs.
Tata-owned JLR is among major car manufacturers facing uncertainty after US President Donald Trump revealed plans in early April for 25 per cent tariffs on cars imported into the US.
The company, the UK's top exporter of vehicles to the US, initially paused shipments to America as it worked to address the new trading terms - before restarting shipments after a month.
Last week however, Mr Trump and UK Prime Minister Sir Keir Starmer agreed a UK-US trade deal which will cut this to 10 per cent for the first 100,000 cars produced in the UK.
Adrian Mardell, chief executive of JLR, said the company “should be OK in coming below that level” and would therefore avoid the higher rate of import taxes on its UK-made cars.
However - the business will face the higher 25 per cent rate on cars made in Europe, such as its Defender model, but said it “hopes” a US-EU trade deal can be agreed to reduce this.
The chief executive said it is “not planning” to start making cars in the US to sell in the country in order to avoid paying tariffs in the country.
Mr Mardell said: “We had and currently have no cause to build cars in the US at this time, but we cannot discount that it could be the case at some point."
The company, which employs around 40,000 people across its global operation, halted shipments to the US in early April after the original tariffs were announced but restarted these last week.
On Tuesday, JLR reported a pre-tax profit of £2.5 billion for the year to March 31, its strongest profit figure for a decade.
Meanwhile, revenues were flat at £29 billion for the year despite a 1.7 per cent decline in the final quarter of the year.
The group said it benefited from record wholesale volumes of its Defender cars, which sold 115,404 units over the year.
