r/Economics • u/MoJoSo69 • 18h ago
News UK resists EU pressure to hit China with tariffs | Trade policy
https://www.theguardian.com/politics/2026/oct/14/uk-will-not-put-tariffs-on-chinese-vehicles-says-jonathan-reynolds15
u/lifeisaman 11h ago
If the EU wants the Uk to harm domestic consumers to help preserve the German auto industry then they have to offer something in return, this is just basic geopolitics.
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u/JimTheSaint 7h ago
UK has there own auto industry with the same problems with chinese competitiveness when its based on extreme subsidies in China.
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u/lifeisaman 6h ago
The Uk auto industry is mostly higher end vehicles that the Chinese aren’t really competing with at the moment.
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u/JimTheSaint 6h ago
that is just of matter of time, it's just a matter of time until Uk will have to take this fight themselves.
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u/lifeisaman 6h ago
Maybe in future, but for now their isn’t any benefit for the Uk to protect the German auto industry, if the EU wants that then they’ve got to give something up because for now it’s not in our interest to put up a tariff to protect other countries industries.
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u/JimTheSaint 5h ago
it's inevitable, China keep climbing up the value line, and with so many subsidies that it will be impossible to compete with for the UK auto industry. So in 5 - 10 years time the UK auto industry will demand it, and then maybe the German auto-industry won't exist at all or have already made a somewhat worse deal with China, then UK will have to make their own, also bad deal, with China.
Instead of recognizing that they are in the same situation just a few years apart and make a better deal by working together.2
u/lifeisaman 5h ago
That’s not a current issue for the Uk though is it, the UK doesn’t have good enough reason to screw over the British public to protect German industry, if Europe wants the UK to put up tariffs for their benefit then their going to have to offer the Uk something of suitable value, it doesn’t make much a difference to the British consumer if their buying German or Chinese for their Budget EV’s.
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u/TurboSardine 18h ago
If the UK Gov judges that EU tariffs are this bad for Britain - even despite the wider commercial pressure the EU is applying to adopt them - how is it feasible that the UK could join the customs union either as a member or as a non-member?
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u/Thorazine_Chaser 18h ago
I suppose the argument would simply be that a customs union brings benefits to other industries while a one off tariff on cars doesn’t.
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u/TurboSardine 17h ago
Yes that is the simplistic answer. But it doesn’t work that well when you consider how many tariff lines the UK has reduced to zero (or otherwise adjusted) since registering its own global tariff.
This new case (UK/EU-China) is interesting given it shows the stark difference of interest in trade policy for a major (and politically influential) manufacturing sector
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u/mmoonbelly 16h ago
The Chinese have responded to the EU car tariffs with extra tariffs on spirits and alcohol (very likely this would extend to the UK if the UK follows the EU approach)
It’s a question of whether the UK values the Whisky industry more than its car industry. The EU is certainly kicking Cognac when it’s down.
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u/lifeisaman 11h ago
The Uk car industry is more about luxury vehicles and doesn’t directly compete with the Chinese mass market models.
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u/Thorazine_Chaser 16h ago
It’s simplistic because it’s is simple, and true.
Your counter point is irrelevant. A tariff on Chinese cars doesn’t remove any regulatory burden from any other industry. That’s all we need to know to answer your original question.
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u/TurboSardine 16h ago
No one is claiming such a tariff removes regulatory burdens on other industries, and your reply is gobbledegook.
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u/Thorazine_Chaser 15h ago
A customs union does, and that’s why a customs union is a very different proposition to a one off tariff.
Your question has been answered, I get the sense that you won’t recognise any answer though.
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u/TurboSardine 15h ago
Oh dear. I’m talking to an overconfident halfwit. A customs union does NOT deal with regulatory barriers. It’s a waste of time talking to you if you don’t understand trade / EU architecture. Bye!
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u/teamonkey 16h ago
Because it’s leverage against the EU. The EU want to reduce cheap Chinese imports on their doorstep. Well, says the PM, what are you going to do to make this worth our while?
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u/tekkerslovakia 15h ago
If each US state enacted its own independent trade policy, each state would choose to diverge in different ways from the current federal trade policy.
However, each state recognises that the benefits of being part of the United States outweigh the benefits of making independent trade decisions.
The same argument applies to the EU customs union.
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u/ydouhatemurica 14h ago edited 14h ago
i disagree, because generally the countries in western Europe outside EU customs union are richer than the countries in the customs union... like Norway, Switzerland, Iceland... which to me implies being outside EU is better than being in EU, something fundamentally is wrong with EU imo. Look at the growth rates of west europe ever since EU happened, germany france, italy flatlined, just before EU they were growing pretty quick... Prior to EU, most european countries were on par with USA in gdp per capita if not richer, now the US is almost 50% more than most of the richer eu nations...
Whatever EU is doing something is deeply deeply wrong in it...
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u/Jujubatron 18h ago
Good. EU are masters of killing our economy. Whatever they push for do the opposite. Their regulation already destroyed a lot of the businesses now they wanna plunge us into a trade war to protect the high prices of some of their sectors.
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u/ApartExperience5299 17h ago
UK has no car manufacturers? You have no idea what you are talking about.
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u/BrillsonHawk 14h ago
Not really no. Our biggest brands are German - mini, Rolls Royce and Bentley. JLR has killed Jaguar and is only kept alive by land rover.
Yeh I am sure you will argue a lot of people are employed in the car industry in this country and that is true, but Chinese companies are already looking at local production, which will replace a lot of that. Lotus are chinese owned, but still manufactured in the UK. Both Jaguar (Indian company) and Nissan (Japanese company) are looking at producing the cars of Chinese companies in their factories. Nissan already has an agreement to do so. Toyota exports most of the cars it produces in Derbyshire to Europe, as does Nissan. They want these tariffs to protect the German car industry as we are their second largest customer - not our problem if they can't compete.
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u/AngelousSix66 17h ago
We have no 'up-to-date' car manufacturers. Most of them make cars with yesteryear's technology, funded by the future of our children. Keeping these manufacturers alive is like flogging a dead horse.
Just like what they are attempting in Germany. In fact, the Germans make better vehicles out of their joint ventures in Asia than they do in Germany itself.
'But the jobs!', you'd say. Coal mining, steel making, video rentals are all jobs you'd find in early 2000s in UK but no longer exist today. Why should auto manufacturing be special?
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u/ApartExperience5299 17h ago
When AI comes for your job you will also be ok with it, yes?
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u/AngelousSix66 14h ago
Mate, where I'm at, we embrace AI and it's already part of our daily lives. Half my job is run by AI now and the next evolution of the job is to have AI replicate 10 of me while I tend to my kids and garden at home.
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u/ydouhatemurica 14h ago
thats the point uk will have to import them, if it applies tariffs the imports get more expensive and likely come from eu... whereas without tariffs uk citizens get cheaper cars, and more EVs... (good for environment) however eu loses an export market hence the eu pressure on uk...
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u/Asleep-Ad1182 14h ago
the UK pretty much only produces luxury cars and China isn't much of a competitor in the luxury car market.
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u/ProfessionalSong3544 10h ago
Uh. China is a competitor for the luxury car market. I think you have not seen luxury Chinese cars.
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