Jaguar Land Rover halts US shipments as Trump’s tariffs bite placing 9,000 jobs at risk

Jaguar Land Rover has announced a temporary pause on all vehicle shipments to the United States, as the British carmaker scrambles to navigate the new trading terms imposed under President Donald Trump’s global tariff regime.

The company confirmed it is taking short-term action in April while it works with business partners to assess the impact of the tariffs and formulate mid- to long-term plans. The decision follows the US imposition of a 25% levy on foreign-made cars, which came into effect on Thursday, alongside a baseline 10% tariff on all imported goods, rolled out globally from Saturday.

“The USA is an important market for JLR’s luxury brands,” the company said in a statement. “As we work to address the new trading terms with our business partners, we are taking some short-term actions including a shipment pause in April.”

The move has raised alarm in the UK automotive sector, particularly in Solihull, home to one of JLR’s five manufacturing plants, employing over 9,000 workers. The town has been a historic hub for British automotive engineering, but Trump’s tariffs have cast uncertainty over its economic future.

Robert Mills, a former automotive consultant and long-time Solihull resident, fears the tariffs could decimate local employment.

“I’m appalled. It will kill Jaguar Land Rover here in the town,” he said. “There could potentially be job losses because JLR export enormously to America. The knock-on effect is going to be enormous.”

Trump’s policy shift has stunned markets, with global equities sliding and major indices posting their worst day of trading since the pandemic. The FTSE 100 closed down 4.95% on Friday, wiping nearly 420 points in a single session, while Wall Street’s Dow Jones plunged 5.5%. The tariff package includes a 20% levy on EU goods and 34% on Chinese imports, prompting Beijing to retaliate with matching tariffs on US products starting 10 April.

The UK automotive industry, already under strain due to slowing domestic demand and the transition to electric vehicles, is expected to suffer considerably. Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), said: “The industry is already facing multiple headwinds and this announcement comes at the worst possible time.”

In 2023, UK car production slumped by 13.9% to 779,584 vehicles, with over 77% of that output destined for export. The US is Britain’s single largest market for vehicle exports, with an estimated £8.3 billion worth of cars shipped across the Atlantic in the 12 months to September 2024.

To soften the immediate blow, UK carmakers had reportedly stockpiled vehicles in the US prior to the tariffs taking effect. But Jaguar Land Rover, which does not manufacture any vehicles in the US, is particularly exposed. A report from GlobalData confirms it is the most at-risk car brand in the American market due to its full reliance on overseas production.

Tony Rhea, 77, a retired electrical engineer who spent decades working with Land Rover, said the effects of a prolonged export disruption would ripple through the local economy.

“Everyone is affected. Right down to the cafe where they eat, the people who wash their overalls and even the people that maintain the robots — that’s all local.”

Prime Minister Keir Starmer has so far resisted retaliating against Trump’s tariffs, stating that the UK will “calmly continue with our preparatory work” and seek a deal that protects British interests. However, the government has set a 1 May deadline for consultations on possible reciprocal measures, warning that “all options are on the table”.

Trump, however, struck a different tone, bizarrely claiming that Starmer was “very happy” with the tariffs and maintaining that “the markets are going to boom”. He added: “They’ve taken advantage of us for many, many years. I think it’s going to be unbelievable.”

Economists disagree. The Office for Budget Responsibility has already cut its UK growth forecast from 2% to 1%, not including the effects of the tariff shock. Thomas Pugh, economist at RSM UK, warned that Britain faces “another year of stagnation at best,” noting the likely impact on interest rates and fiscal flexibility.

“We wouldn’t go as far as to say this has wiped out the £10 billion Rachel Reeves just rebuilt, but it’s probably not far off.”

The full fallout remains to be seen, but with UK exports to the US valued at over £60 billion annually, and estimates suggesting that up to 70% of those exports could be affected, the pressure on Downing Street to act is growing.

As global leaders, including the prime ministers of Australia and Italy, express shared concern over a looming trade war, Starmer is expected to spend the weekend holding calls with counterparts to coordinate a response.