Britain’s biggest export to America faces disaster as new tariffs threaten jobs and prices. Here’s what it means for you.
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00:00Well, OK, let's remember what tariffs are.
00:04It's effectively an import duty on the manufacturer, if you like, or the organisation sending goods
00:10into a country.
00:11If you like, it's a disincentive to home-produced buyers to buy that good, as it were, which
00:18of course they would probably hope, or at least Trump would hope, that domestic producers
00:22will get the advantage by making a straightforward substitution.
00:26So remember, when we're talking about vehicles, which is the largest amount, the largest portion
00:31of goods that go into America, we're talking about high-end, such as the Jaguar Land Rover,
00:37Bentley, Aston Martin, and probably should include Rolls-Royce.
00:43So of course, the fact is that the people that we're talking about are more likely to
00:47make that substitution or pay an extra tax, as it were, to get those goods.
00:51But nonetheless, because of how this will work, it'll be passed on to those selling
00:56the goods.
00:57And indeed, as I say, this is where the disincentive sort of lies.
01:00And obviously, this move is going to have a massive impact in places like Sunderland
01:05or the West Midlands, where car manufacturing is a major employer.
01:09But the knock-on effects affect all regions across the country, because many people work
01:14in the supply chain.
01:16The situation has prompted urgent calls for immediate diplomatic intervention.
01:23Now, of course, in extremis, if those people stop buying it, we're talking about the total
01:29value of goods we send or bought to Wales is in the billions, about eight, nine billion.
01:34Now, of course, the thing is, though, that if we sort of forego that, then of course,
01:39there is a consequence in lost jobs in this country.
01:41It's not good, as I say.
01:44My hope is, well, there are a couple of hopes, one of which is that these tariffs will probably
01:49be introduced to the EU.
01:51Whether they are introduced to UK producers remains open to question.
01:56There is a view that somehow or other, Rachel Reeves, Starmer, perhaps King Charles, when
02:01he goes over to America, may be able to smooth talk Trump, who seems to be capable of so
02:06doing.
02:07If you can get him for long enough and get him to sign something, it may not happen.
02:11But yeah, it could be potentially pretty devastating to those large producers or those producers
02:16rather, or the larger producers of the luxury cars, which some of us buy, but of course,
02:23they're not the mainstream.
02:24And as I say, anything that sort of undermines their business is problematic at present.