Keir Starmer will give an address in the West Midlands this afternoon as panic grows over Donald Trump’s tariffs, which experts fear will cause a global recession
Keir Starmer will give a major speech this afternoon as panic spreads over Donald Trump’s tariffs and fears of a global recession.
The Government has announced a string of measures to support car makers after the volatile US President slapped a 25% tariff on foreign cars, and 10% on other goods. The PM will give an address at around 2.20pm as fears of a global financial meltdown grow.
The FTSE 100 dropped by 6%, and nations including China have piled pressure on the US President. Transport Secretary Heidi Alexander, pressed on Sky News about whether the US rules will plunge the world into a financial “bloodbath”, said: “So the imposition of global tariffs and the reciprocal tariffs that some countries have and retaliatory tariffs, some countries have decided to apply are bad news for the global economy because it’s bad for global demand, it’s bad for prices and it’s bad for consumers.
“And so that is why we have to do everything that we can to protect the interests of the British people and British businesses, and that is why we are setting out a package of support today for the car industry to provide certainty to British manufacturers and to ensure that they can remain at the cutting edge of the transition to electric vehicles and also make sure that consumers can benefit from the cheaper running costs of electric vehicles as well.“
Asian markets plunged on Monday following last week’s two-day meltdown on Wall Street. Under new measures to be announced today, rules around fines for manufacturers who do not sell enough electric cars will be relaxed, and supercar firms will be exempt. The PM said that the “new era of global instability” would push the Government to go “further and faster” to support businesses.
Jaguar Land Rover said over the weekend that they would “pause” shipments to the US, as they look to “address the new trading terms”. As part of his announcement in the West Midlands, Mr Starmer will reinstate the 2030 ban on the sale of new petrol and diesel cars.
Describing the car sector as “the engine room of British industry”, Sir Keir wrote in The Times: “We want British car companies to be at the forefront of the electric vehicle revolution at home and overseas.” He also said that “in this new era of global instability we will go further and faster to support businesses and workers”.
The PM said today’s measures will be “just the first in a series” of announcements from the Government, designed to provide “certainty” and “support for industry”. The PM spent the weekend in calls with foreign leaders about the tariffs, after he promised to do “everything necessary” to protect Britain’s national interest.
After calls with the leaders of France, Italy and Australia in recent days, Sir Keir used conversations with European Commission president Ursula von der Leyen, German Chancellor Olaf Scholz and leader of the German Christian Democratic Union party Friedrich Merz, to reiterate his disappointment at the measures announced by the White House.
Regulations around manufacturing targets on electric cars and vans will also be altered, to help firms in the transition, and new hybrids will be on the market for another five years. Luxury supercar firms such as Aston Martin and McLaren will still be allowed to keep producing petrol cars beyond 2030, because they only manufacture a small number of vehicles per year.
New hybrids and plug-in hybrid cars will be allowed to be sold until 2035. Petrol and diesel vans will be able to be sold until 2035, as well as all hybrid models. Officials are also going to make it easier for manufacturers who do not comply with Government-mandated sales targets to avoid fines, and the levies will be reduced.
The Government says support for the car industry will continue to be kept under review, as the full impact of the tariffs announced last week becomes clear. The Liberal Democrats have said that the moves on their own “won’t be enough to protect the sector from the impact of Trump’s damaging taxes”.
Trade spokesman Paul Kohler said “ministers should also be exploring better incentives for consumers to buy electric vehicles, including VAT cuts for public charging and postponing the planned increase in vehicle tax on electric cars”.
The US president said he would not back down on tariffs unless countries even their trade balance with the US. Speaking on Air Force One on a flight back to Washington, Trump said he did not want global markets to fall, but that “sometimes you have to take medicine to fix something”. He also said he had spoken to leaders from around the world.
“They’re dying to make a deal,” he said. “And I said, we’re not going to have deficits with your country. We’re not going to do that, because to me a deficit is a loss. We’re going to have surpluses or, at worst, going to be breaking even.”