UK car production in May 2025 plunged to its lowest non-pandemic level since 1949, as exports to the United States were halved due to a steep rise in tariffs, according to new data from the Society of Motor Manufacturers and Traders (SMMT).
Output dropped by nearly a third year-on-year to just 49,810 vehicles, as major manufacturers including Jaguar Land Rover (JLR) and Aston Martin scaled back or suspended shipments to the US in response to a 25% import tariff imposed by the Trump administration in March. The SMMT said the tariff “instantly depressed demand,” forcing companies to halt exports.
The US share of UK car exports declined significantly from nearly 20% last year to just over 10% in May. The trade disruption comes at a time when the UK auto sector is also adjusting to a long-term transition toward electric vehicle production. JLR is shifting Jaguar to a fully electric lineup, and Nissan is preparing to launch its new electric Leaf model.
However, there is a glimmer of hope. A recent UK-US agreement will reduce tariffs on the first 100,000 UK-made cars exported to the US annually from 25% to 10%. Any exports above that threshold will still face a 27.5% tax. The deal is expected to come into effect before the end of June.
SMMT chief executive Mike Hawes described 2025 as “an incredibly challenging year” but noted that trade agreements with the US, India, and the EU, along with the UK’s recently announced industrial strategy, offer reasons for optimism. The government’s new policy includes lower energy costs for manufacturers and a £2.5 billion fund to support automotive innovation and research.
The SMMT hopes these developments will help stabilise the industry and support its recovery in the second half of the year.
