British high-end automaker Lotus facing job cuts in the UK due to US tariffs
In a significant development for the UK automotive industry, the trade agreement between Britain and the United States has had a notable impact on the tariff rate for UK car exports to the US. The agreement, which came into force on June 30, 2025, reduced the tariff rate from a hefty 27.5% to a more manageable 10% for the first 100,000 vehicles per year.
This reduction has been a welcome relief for automakers, who have been significantly affected by the tariff onslaught initiated by former US President Trump, aiming to bring auto production back to the US. The move was intended to protect domestic industries but had far-reaching consequences for international trade.
The restructuring decision by Lotus, a renowned British car manufacturer, is influenced by the rapidly changing global policies and tariffs in the automotive industry. The company, which is majority owned by Chinese auto giant Geely, has announced layoffs affecting over 40% of its 1,300 employees in Britain. The rapid evolving automotive environment, including uncertainty with global policies and tariffs, is cited as a reason for the restructuring.
Despite the reduction, the current tariff rate remains higher than the rate before Trump's tariff blitz in April. This, combined with the restructuring, has led to a challenging period for Lotus. However, the company remains optimistic, with the restructuring aimed at securing a sustainable future for Lotus.
The tariff rate reduction has contributed to a rebound in UK vehicle exports to the US. Industry data showed an increase in UK vehicle exports to the US on Thursday, following months of declines. UK exports of vehicles to the US rebounded in July, a positive sign for the industry's recovery.
Lotus, aside from its sites in multiple locations in the UK, also has a factory in Wuhan, China. The company's headquarters is located in Hethel, eastern England. The restructuring will likely have a ripple effect across the industry, as other automakers navigate the complexities of the evolving global trade landscape.
In conclusion, the UK-US trade deal has brought some relief to the UK automotive industry, with reduced tariff rates for car exports. However, the industry continues to face challenges, with the rapid evolving global policies and tariffs posing significant hurdles. The restructuring at Lotus, while difficult, is a testament to the company's commitment to securing a sustainable future in this challenging environment.
