Trump tariffs are a 'lose-lose' situation says Shropshire Chamber of Commerce

Last night (April 2) US President Donald Trump announced a wide ranging new set of tariffs on imports into the USA, arguing that they would allow the country's domestic economy to flourish.

The tariffs include a baseline rate of 10 per cent, which imports from the UK are subject to, with higher rates for other countries based on so-called 'reciprocal' rates. Imports from the European Union face a 20% tariff.

However the UK is also affected by an across-the-board 25% rate on car exports to the USA, designed to boost American car manufacturing.

Ruth Ross, Shropshire Chamber of Commerce chief executive, said: “As the British Chambers of Commerce stated this morning, the Government has kept a cool head so far and must continue to negotiate. This is a marathon not a sprint, and getting the best deal for the UK is what matters most. 

“But no-one will escape the fallout from these decisions, there will be an increased risk of trade diversion, and it will wreak havoc on businesses communities across the world. 

“Orders will drop, prices will rise, and global economic demand will be weaker as a result. The chambers of commerce network sees this as a lose-lose situation for everyone. 

“So, it is vitally important that the government does not give up on negotiations. Tariffs can be lifted at any time and the US has signalled its willingness to do some form of deal with us. 

“Many firms, especially SMEs, will now be facing difficult decisions and the chamber network urges government to do all it can to provide practical support to them."

The UK Government has ruled out imposing retaliatory tariffs while talks on an economic deal with the US continue, and are hoping for further relief for UK companies, which export more than £60bn worth of goods to the US each year.

At Prime Minister's questions this week, Kier Starmer said a potential trade war with the USA was in "nobody's interest" and said the government would be taking a "pragmatic approach" to a trade deal.

“Constructive talks are progressing to agree a wider economic prosperity deal with the US. That is why we are working with all industries and sectors likely to be impacted," he said.

“Our decision will always be guided by our national interests, and that’s why we have prepared for all eventualities, and we will rule nothing out.”

The 25% tariff on car exports to the US is likely to hit the West Midlands in particular, with several large manufacturers based in the region including Jaguar Land Rover, Aston Martin and Morgan. The US is Britain’s second largest car export market after the EU, with more than 101,000 cars exported in 2024, representing 16.9% of the total number exported from the UK.

Last week, Jaguar Land Rover, which has manufacturing operations in Wolverhampton and Solihull, said it was "assessing options" ahead of the tariff announcements.