UK Car Production Hits 70-Year Low Amid Tariffs, EV Shift, and Export Challenges

In April 2025, UK car manufacturing experienced a significant decline, with production dropping to 59,203 vehicles—the lowest April output in over 70 years, excluding the pandemic-affected April 2020. This represents a 16% decrease compared to April 2024 and a 25% drop from March 2025.

Factors Contributing to the Decline:

• US Tariffs: The introduction of a 25% tariff by President Trump on steel, aluminium, and cars impacted exports. Jaguar Land Rover (JLR) reported paying 27.5% tariffs on shipments to the US, incurring substantial costs. Although a new UK-US trade deal was agreed upon in early May to reduce car tariffs to 10% for up to 100,000 vehicles, its implementation has been delayed.
• Seasonal Effects: The timing of Easter in April resulted in fewer working days, contributing to reduced production.
• Industry Transition: The shift from petrol to electric vehicles (EVs) has temporarily decreased output as manufacturers adjust to new production processes.

Export and Domestic Market Impact:

Exports fell by 10.1%, primarily due to decreased demand from the US and EU, the UK’s largest export markets. However, the domestic market remained relatively stable, with increased sales of new and used cars. Nathan Coe, CEO of Autotrader, noted that while manufacturing declined due to export challenges, the UK market itself has seen growth.

Broader Industry Context:

The decline in UK car manufacturing aligns with global trends, with countries like Germany, Italy, France, and Japan facing similar challenges. However, the UK faces unique pressures, including fewer trade barriers against Chinese imports compared to the EU and US, and recent policy changes affecting EV manufacturing incentives. Professor Peter Wells from Cardiff University emphasized the need for stability and clarity in policy to support the industry.

For more details, read the full article on BBC News: UK car making plunges to lowest for over 70 years.