UK tariffs on Chinese cars under consideration amid pressure from EU
EU leaders have told the UK that placing tariffs on state-subsidised Chinese cars is imperative if it wishes to benefit from Made in Europe status
Chinese domination of the UK’s car market could be short-lived. Reports suggest the Government is weighing up imposing tariffs on vehicle imports from China in order to secure a deal with the EU to protect Britain’s own car industry.
According to The Times, Business secretary Jonathan Reynolds is in the process of devising new tariffs on Chinese cars in order to appease the EU amidst negotiations over its controversial, and potentially damaging, ‘Made in Europe’ laws. This comes only a few weeks after the MP for Stalybridge and Hyde told Auto Express directly: “If you put trade protections up, they’ll probably be reciprocated and you’ll lose things.”
There have long been concerns from European car makers that models hailing from China have been granted an unfair advantage, with allegations that state subsidies from Beijing have contributed to their rock-bottom pricing strategies. With this in mind, the EU has already begun placing tariffs on Chinese imports, with higher levies placed on manufacturers deemed to have received more substantial state funding. That’s on top of the new ‘Made in Europe’ laws, which also potentially threaten the UK’s car-making sector.
Designed to protect its own industries, the EU’s Made in Europe scheme provides locally built cars with state-backed grants and tax breaks for consumers, as well as CO2 credits for manufacturers selling small EVs. Such benefits effectively make non-compliant models uncompetitive – a problem given that UK-built vehicles currently do not qualify for ‘Made in Europe’ status.
Insiders suggest that EU leaders have made it clear that imposing tariffs on market-disrupting Chinese vehicles is imperative if Britain wishes to be included within the Made in Europe scheme. Whether the Government will want to be seen to be bending to EU demands is another story, although UK car industry officials have suggested that not securing a deal could be disastrous; the Society of Motor Manufacturers and Traders suggested last month that not being part of the ‘Made in Europe’ scheme could not only threaten the UK-EU trade relationship worth around 80 billion Euros (£68bn), but thousands of jobs on both sides, too.
In a statement, a Government spokesperson said: “We have not put tariffs on Chinese EVs. We continue to engage closely with industry so that our approach reflects the sector’s and the UK’s national interests.”
In the meantime, the Chinese Jaecoo 7 was named the best-selling car during September’s bumper month for new registrations. The Jaecoo is now the second best-selling car of 2026 overall, with China’s MG and BYD both also making it into the lists of top-selling models and electric cars respectively. In fact, Auto Express analysis earlier this year uncovered that China is now the UK’s second-most popular county for automotive brands, coming ahead of Japan and Korea and just behind Germany.
The Insight director at Cox Automotive, Philip Nothard, said: “The increasing influence of Chinese manufacturers is impossible to ignore. Their growing presence is stimulating competition and a greater range of consumer choice. Still, it is also intensifying pressure on established brands, especially as the industry continues to work towards increasingly demanding EV targets.”
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