British car lobby group warns of £1.4 billion potential hit from post-Brexit rules

Tue, June 30, 2026 at 8:15 AM UTC

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LONDON, June 30 (Reuters) - British electric vehicle makers will have to pay £1.4 billion ($1.85 billion) in tariffs if there is no solution on local content requirements - known as rules of origin - with the European Union, the country's main car lobby group estimated on Tuesday.

The imposition of the rules on the sourcing of parts, which was delayed once in 2023 and is now due to take effect from January, will trigger a 10% tariff on 70% of battery electric and plug-in hybrid models traded with the EU, the Society of Motor Manufacturers and Traders (SMMT) said in a statement.

The British-EU battery electric and plug-in hybrid vehicle trade - estimated at £16.4 billion - faces a risk from such an enforcement, which the SMMT says would make "many of these crucial models less competitive and less affordable."

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Britain and the EU are each other's largest market for exports of EVs, which are being encouraged as an alternative to carbon-emitting internal combustion engine vehicles powered by gasoline or diesel.

The previous extension had come after some carmakers threatened to close their plants in Britain.

(Reporting by Muvija M and Nick Carey; Editing by Thomas Derpinghaus)

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