President Donald Trump has signed an executive order to implement a new US-UK trade deal, easing tariffs on British automotive and aerospace exports while promising further negotiations on steel and pharmaceutical products. The move marks a significant step in post-Brexit transatlantic trade, as the UK becomes the first nation to secure a bilateral trade agreement with the United States since Trump’s introduction of sweeping tariffs in April.
Key Provisions of the Trade Agreement
Under the deal, which was originally unveiled on May 8 in the Oval Office, the United States will:
- Reduce its tariff on UK car exports from 27.5% to 10% for the first 100,000 vehicles shipped annually.
- Waive tariffs on jet engines and other aerospace components, exempting the UK from ongoing US national security probes targeting the aerospace sector.
- Allow tariff-free access to the US beef, ethanol, and industrial product markets, following new concessions from the UK.
Trump formalized the deal during a brief meeting with UK Prime Minister Keir Starmer at the G7 summit in Kananaskis, Canada. “We just signed it and it’s done,” Trump told reporters, calling the move “a very good day for both of our countries.”
Immediate and Pending Benefits
The UK government said provisions benefiting British carmakers and aerospace manufacturers would take effect by the end of the month. According to the executive order, Commerce Secretary Howard Lutnick has seven days to revise tariff rates on UK goods after the order is filed.
The deal also outlines future negotiations to determine how the US might impose pharmaceutical tariffs and how exemptions could be applied.
Despite the progress, UK steel producers will have to wait. The agreement envisions a zero-tariff regime for British steel and aluminium exports, but technical and legal delays remain. Much of UK steel is reprocessed from imported materials and currently fails to meet US “melted and poured” origin requirements for tariff exemption.
Steel Talks Still Underway
While the UK was granted a temporary exemption to Trump’s 50% global steel tariff, a final quota system allowing UK steel producers to avoid the tariff has yet to be confirmed.
A Downing Street spokesperson said that “talks between the UK and the US are continuing,” and both governments remain committed to achieving zero per cent tariffs on core steel products.
Industry representatives, however, warned that finalizing and implementing the steel arrangement could take until the end of the month or longer.
Mixed Reactions from Industry
The Society of Motor Manufacturers and Traders (SMMT) praised the agreement as “great news” for Britain’s carmakers, who have struggled under elevated tariffs.
In contrast, the UK’s bioethanol industry voiced strong opposition to the deal’s 1.4 billion litre tariff-free ethanol quota for American producers—an amount equal to the UK’s entire annual ethanol demand. Domestic producers warn the measure will undermine British ethanol output and threaten jobs in the sector.
Strategic Context
The US-UK trade pact is part of Trump’s broader “liberation day” tariff strategy, announced in April, which imposed or threatened tariffs of up to 50% on numerous trading partners. The UK’s compliance with U.S. demands—particularly excluding China from critical supply chains—was a key factor in securing its exemptions.
The deal is seen as a diplomatic and economic win for both governments. For Trump, it demonstrates progress in reshaping trade relationships under his second-term strategy. For Starmer, it is a chance to deliver immediate relief to UK industries affected by US tariffs and to assert post-Brexit trade independence.
As both governments continue technical negotiations over steel and other sensitive sectors, the agreement underscores the shifting landscape of global trade, increasingly shaped by national security considerations and strategic alliances.
President Donald Trump has signed an executive order to implement a new US-UK trade deal, easing tariffs on British automotive and aerospace exports while promising further negotiations on steel and pharmaceutical products. The move marks a significant step in post-Brexit transatlantic trade, as the UK becomes the first nation to secure a bilateral trade agreement with the United States since Trump’s introduction of sweeping tariffs in April.
Key Provisions of the Trade Agreement
Under the deal, which was originally unveiled on May 8 in the Oval Office, the United States will:
- Reduce its tariff on UK car exports from 27.5% to 10% for the first 100,000 vehicles shipped annually.
- Waive tariffs on jet engines and other aerospace components, exempting the UK from ongoing US national security probes targeting the aerospace sector.
- Allow tariff-free access to the US beef, ethanol, and industrial product markets, following new concessions from the UK.
Trump formalized the deal during a brief meeting with UK Prime Minister Keir Starmer at the G7 summit in Kananaskis, Canada. “We just signed it and it’s done,” Trump told reporters, calling the move “a very good day for both of our countries.”
Immediate and Pending Benefits
The UK government said provisions benefiting British carmakers and aerospace manufacturers would take effect by the end of the month. According to the executive order, Commerce Secretary Howard Lutnick has seven days to revise tariff rates on UK goods after the order is filed.
The deal also outlines future negotiations to determine how the US might impose pharmaceutical tariffs and how exemptions could be applied.
Despite the progress, UK steel producers will have to wait. The agreement envisions a zero-tariff regime for British steel and aluminium exports, but technical and legal delays remain. Much of UK steel is reprocessed from imported materials and currently fails to meet US “melted and poured” origin requirements for tariff exemption.
Steel Talks Still Underway
While the UK was granted a temporary exemption to Trump’s 50% global steel tariff, a final quota system allowing UK steel producers to avoid the tariff has yet to be confirmed.
A Downing Street spokesperson said that “talks between the UK and the US are continuing,” and both governments remain committed to achieving zero per cent tariffs on core steel products.
Industry representatives, however, warned that finalizing and implementing the steel arrangement could take until the end of the month or longer.
Mixed Reactions from Industry
The Society of Motor Manufacturers and Traders (SMMT) praised the agreement as “great news” for Britain’s carmakers, who have struggled under elevated tariffs.
In contrast, the UK’s bioethanol industry voiced strong opposition to the deal’s 1.4 billion litre tariff-free ethanol quota for American producers—an amount equal to the UK’s entire annual ethanol demand. Domestic producers warn the measure will undermine British ethanol output and threaten jobs in the sector.
Strategic Context
The US-UK trade pact is part of Trump’s broader “liberation day” tariff strategy, announced in April, which imposed or threatened tariffs of up to 50% on numerous trading partners. The UK’s compliance with U.S. demands—particularly excluding China from critical supply chains—was a key factor in securing its exemptions.
The deal is seen as a diplomatic and economic win for both governments. For Trump, it demonstrates progress in reshaping trade relationships under his second-term strategy. For Starmer, it is a chance to deliver immediate relief to UK industries affected by US tariffs and to assert post-Brexit trade independence.
As both governments continue technical negotiations over steel and other sensitive sectors, the agreement underscores the shifting landscape of global trade, increasingly shaped by national security considerations and strategic alliances.
