Ever since the first Land Rover rolled off the production line in Solihull in 1948, the medieval market town has become synonymous with the carmaker. But the fallout from the US president’s recent actions threatens to wreak havoc on the flagbearer of the UK’s automotive industry.
Last week, Donald Trump announced new import taxes of 25% on cars and car parts coming into the US in a move the president said would drive growth and spur on investment. The Institute for Public Policy Research warns this could be costly, with 25,000 UK jobs at risk.
Yesterday, Jaguar Land Rover (JLR) announced it would “pause” shipments to the US as it worked to “address the new trading terms”. JLR sold about 100,000 cars in the US last year, a critical market for the company. The Solihull plant that makes the Range Rover employs more than 9,000. The new Jaguar Type 00, which was launched in Miami in December, will be made in the West Midlands from 2026.
In Solihull, everyone knows somebody at JLR. As news filtered through to the high street about China’s retaliatory tariffs on Friday, a local man, Wayne Kelly, said he felt it was too early for judgments on the potential impact. “I think JLR might lay a few people off. But I believe that if you’re going to buy a Range Rover and you’re American, you’ll pay the extra money anyway, because you’ve got enough to afford it. I don’t think it will affect it, maybe a little bit, but not so great as if it [were] mid-range or low-range vehicles.”
Prof David Bailey at the nearby Birmingham Business school describes the trade war as “nothing short of a perfect storm” for the European and UK auto industry, which was already being squeezed by falling sales in China, stagnant demand in Europe, and slow electrical vehicle (EV) (EV) take-up.
“Much of UK auto is already operating well below capacity and the tariffs will be a further hit for a struggling industry,” Bailey said. “Production cuts and job losses are likely. The UK government has yet to unveil its industrial strategy – this is urgently needed to help shore up the industry.”
Bailey believes JLR may struggle without the option of US-based assembly operations – in contrast to German brands such as Mercedes, BMW and Audi, who are looking to build on their manufacturing presence in the States, which, he says, is what Trump hopes for.
He also feels estimates of jobs at risk in UK auto due to the new Trump’s tariffs are underestimated. “It doesn’t account for tipping points as plants slip below viability levels, hence may be shut completely, not just downsized. Plus the supply chain may be fatally hit if the knock-on effect is that foreign-owned suppliers pull out of the UK as assembly volumes shrink.”
In 2024, the UK exported £8.3bn of cars to the US, with figures from 2023the previous year showing the West Midlands was responsible for 51% of all auto exports to America. According to recent analysis by the City-Region Economic Development Institute (City-REDI) the tariffs are estimated to cost the UK £9.8bn in GDP between 2025 and 2030, putting 137,000 jobs at risk. The data also shows that the West Midlands will be hit hardest, losing £6.2bn in GDP, 62% of the total impact on the UK.
On Friday, JLR seemed defiant. A spokesperson said: “Our luxury brands have global appeal and our business is resilient, accustomed to changing market conditions. Our priorities now are delivering for our clients around the world and addressing these new US trading terms.”
An updated statement on Saturday yesterday explained: “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, as we develop our mid- to longer-term plans.”
Des Quinn, the Unite union national officer for the automotive sector, told the Observer that transformative change is necessary to help insulate the industry and its workers.
“Urgent action is required following the previous government’s lack of industrial strategy and planning for a transition to EVs that reverses the decline in the automotive sector. The likes of Tesla cannot be allowed to benefit from tariffs in their home market while enjoying subsidies through selling EV credits in the UK.
“The automotive sector is the jewel in the crown of UK manufacturing and exports. A level playing field must be created in the absence of a free trade agreement to protect the industry and jobs.”
Florist and owner of Flowers of Solihull, Craig Donaldson, said it would be a shame if the cuts were to result in lay-offs. He has two close friends who are employed at the plant. “They’re in their 50s and have worked there since leaving school. So it would be sad news.”
Donaldson’s family business has been running for 40 years and he joined full-time after leaving the local Alderbrook school at 16. He has weathered the impact of Brexit and Defra inspection costs on flowers he buys from Holland. “We’re very lucky – Solihull is quite an affluent area. It’s a nice town for shopping,” he says.
He hopes the JLR plant does not take a major hit.
“JLR is important to Solihull because it employs a lot of people that live here, as well as on the outskirts. It would affect the area massively.”
