President Donald Trump struck a trade deal with the United Kingdom Thursday that he says will benefit “super luxury” cars and open the door to billions of dollars’ worth of increased market access for American exports.
As part of the agreement, Trump said the U.S. will maintain a 10% baseline tariff on imports from the U.K. Asked if future deals with other countries could also result in tariffs staying at 10%, rather than the higher baseline tariffs Trump threatened April 2 before pausing most for 90 days, he said no.
“The template of 10 is probably the lowest,” Trump said.
While Trump said today’s deal “opens up a tremendous market” for the U.S. and U.K. Prime Minister Keir Starmer characterized Thursday as a “really fantastic, historic day,” some are skeptical about the extent of the announcement’s real impact.
University of Michigan economist Justin Wolfers wouldn’t consider it a major trade deal, noting the U.K. only accounts for about 3% of U.S. trade, meaning 97% is still “up in the air.”
Rather than focusing on carve-outs for one country, Wolfers said another way of reading today is confirmation that the baseline 10% tariff is likely the lowest rate Trump will impose on most countries’ imports.
So, what does that mean for American consumers?
“We all had this hope that at the end of the 90-day pause, he’d come back and have a bit of a think about it, and that’s off the table,” Wolfers told USA TODAY. “They should care about this because this is confirmation that the price of every imported good will be up by 10% or as far as the eye can see.”
Here is what today’s deal could change and a look at what goods imported from the U.K. will remain subject to the 10% tariff that is often passed onto consumers:
More: Live updates: Trump announces trade deal with UK
Lower tariffs on cars imported from the UK
U.S. Commerce Secretary Howard Lutnick confirmed Thursday that while the 10% baseline tariff will remain in effect, it will lower the 25% tariff on cars imported from the U.K. Trump previously imposed to 10% for the first 100,000 vehicles imported each year. Any additional vehicles imported will still be subject to the 25% rate.
While all the details of the agreement have yet to be finalized, it appears to be good news for Rolls-Royce, who manufacture cars in Britain. Trump also singled out Aston Martin cars, the ride James Bond uses in the iconic spy movies, while speaking to reporters Wednesday.
“James Bond has nothing to worry about, that I can tell you,” Trump said in the Oval Office.
That means more luxury automobiles could be imported to the U.S. under the new agreement, but Trump said he will “rarely” make the same decision in negotiations with other countries when it comes to other foreign cars.
Potential lower tariffs on UK steel
The UK said in a press release that the trade deal will also help its steel industry which is “on the brink of collapse.” The UK will no longer be subject to a 25% tariff the U.S. previously imposed, according to the release.
“The Prime Minister negotiated the 25% tariff down to zero, meaning U.K. steelmakers can carry on exporting to the U.S.,” the release states.
A press release from the White House Thursday afternoon does not directly confirm that. It instead states that the U.S. will negotiate an “alternative arrangement” on steel and aluminum and that the deal creates a new trading union for those materials.
In March, Trump said he did not intend to create exemptions on the sweeping steel and aluminum tariffs he imposed.
Expanded US market access in the UK
The White House release said the deal will create a $5 billion opportunity for new exports for U.S. farmers, ranchers, and producers, meaning the U.K. is opening its markets to import more American beef, ethanol and machinery.
“They’re opening up their country,” Trump said. “Their country is a little closed and we appreciate it.”
Lutnick also said a British airline would announce later in May that it would buy $10 billion worth of Boeing planes.
What does the US import from the UK?
While the deal reflects a warmer relationship between the U.S. and the U.K., the baseline 10% tariff remaining in effect means Americans are still likely going to pay more for goods from the nation’s ninth largest trading partner.
In 2024, the U.S. exported nearly $80 billion in goods and services to the U.K. and imported about $68 billion from the country, according to the U.S. Census Bureau. Cars, machinery, and chemicals, mostly for pharmaceuticals, account for the bulk of goods the U.S. imports from the U.K.
The following are some other common imports to the U.S. from the U.K., according to Trading Economics, that will be affected by tariffs:
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Optical, photo, technical, and medical apparatus
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Electrical and electronic equipment
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Aircrafts and spacecrafts
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Beverages, spirits, and vinegar
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Works of art, collectors’ pieces, and antiques
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Plastics
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Furniture
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Pearls, precious stones, metals, and coins
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Essential oils, perfumes, cosmetics, and toiletries
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Iron and steel
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Toys, games, and sports requisites
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Fish, crustaceans, molluscs, and aquatics invertebrates
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Cereal, flour, starch, milk preparations and products
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Aluminum
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Soaps, lubricants, waxes, candles, and modelling pastes
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Animal, vegetable fats and oils, and cleavage products
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Ceramics products
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Dairy products, eggs, and honey
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Glass and glassware
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Knit or crocheted articles of apparel
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Coffee, tea, mate and spices
Reach Rachel Barber at rbarber@usatoday.com and follow her on X @rachelbarber_
This article originally appeared on USA TODAY: How does Trump’s trade deal with the UK affect prices, tariffs?
