The EU and US have reached a new agreement on tariffs, dialling down tensions and avoiding the more severe trade measures that had been expected.
Jamie Harper, Project Consultant at Hooper & Co, explains that while the deal still leaves many EU exporters facing significant costs, it presents a potential opportunity for UK businesses looking to strengthen their US trade links.
The EU-US agreement ultimately appears to soften the blow of potential tariffs while keeping key trade barriers firmly in place.
Most EU exports to the US – including cars, auto parts, pharmaceuticals, semiconductors, and manufactured goods – will now face a 15% import tariff, rather than a previously proposed 30% rate.
However, tariffs on steel, aluminium, and copper remain steep at 50%, offering no relief for those sectors.
In a gesture toward smoother trade, both sides have pledged to reduce red tape on EU imports of US industrial goods, while they are also exploring options to eliminate tariffs or introduce quotas in select sectors.
Meanwhile, the EU has cancelled plans for its own reciprocal tariffs on US goods, easing pressure on transatlantic business relations.
For UK exporters, the difference in rates presents a clear advantage. UK goods typically attract just 10% tariffs, with iron, steel, and aluminium facing 25%, which is far below the new figures affecting EU exporters.
This puts UK producers in a stronger position within the US market. That said, this deal is not a return to pre-tariff norms.
It’s crucial for UK firms that rely on EU components to carefully monitor rules of origin to ensure their goods qualify for the lower UK tariffs moving forward. Misclassification or failure to validate origin can quickly nullify any cost advantage.
At Hooper & Co, we’re advising our clients to assess their supply chain exposure, verify their origin documentation, and understand where their products may incur higher duties.
As the EU-US negotiations continue – especially around quotas and sector-specific access – staying both informed and adaptable will be key.