Gasgoo Munich-Britain will not shift its trade policy under EU pressure, nor will it impose tariffs on Chinese imports simply because other countries demand it, Business Secretary Jonathan Reynolds said.
Image source: EU
Even as political pressure mounts for the UK to align its trade policy with the EU, Reynolds insisted the government will not yield to outside calls for import tariffs on Chinese cars.
The EU levied tariffs on Chinese battery electric vehicles in 2024. On October 9, Brussels and Beijing reached an agreement on hybrid exports, capping shipments to the bloc at 350,000 units a year. The EU worries that cheaper Chinese cars could hollow out European industry and cost local jobs.
Reynolds conceded the UK has not ruled out future trade restrictions on Chinese goods. But he pushed back against EU fears that Britain could serve as a "backdoor" for Chinese vehicles into the European market.
His remarks underscore lingering UK-EU splits on trade and industrial policy—friction that could complicate the Prime Minister's push to bring Britain and the bloc closer together.
Speaking during a trade mission to India, Reynolds said any decision on defensive tariffs will be driven by British interests—not by demands from abroad.
The government thoroughly evaluated the issue in 2024, he noted, and will keep reviewing policy through the lens of domestic industry needs. Because Britain's auto sector is export-driven, that reality must shape any trade policy, he stressed.
The EU currently imposes tariffs of up to 45% on Chinese EVs. That has fueled speculation that Chinese firms could build plants in the UK and sell into the bloc to circumvent those tariff barriers. Nissan, for one, has agreed to explore building cars for Chinese automaker Chery in northern England.
Reynolds dismissed that scenario. No major Chinese automaker currently operates in Britain, he said—so there is no pipeline to funnel UK-built cars into the EU single market through some "backdoor".
Some in the EU argue Britain should tariff Chinese EVs in exchange for letting UK firms access the European market under new trade rules.
Reynolds has already ruled that out, partly out of fear that Beijing could hit back with retaliatory tariffs—hurting British brands like Jaguar Land Rover.
Shutting Britain out of "Made in Europe" rules would hurt Europe itself, Reynolds warned. Impact assessments show that excluding the UK would deal more damage to the bloc, he noted. With British and European auto supply chains so tightly woven, such a move serves neither side's interests.
