The UK’s aerospace industry is among the beneficiaries of a trade deal between the U.S. and Britain that came into effect on Monday. Among the concessions secured in bilateral negotiations has been the removal of a 10% tariff on aircraft engines and parts, with the UK government stating that President Trump has agreed to keep these items rated at 0%, while tariffs on Britain’s automotive sector have been reduced from 27.5% to 10%.
Among other leading U.S. trading partners, the EU and Canada face extreme uncertainty over the tariffs their industries will be burdened with. In both cases, negotiations with the Trump Administration appear to be blocked as the July 9 deadline for agreeing on new trade details is now just a week away. More specifically, tariffs on steel and aluminum still remain to be settled, although for now the UK at least has avoided the 50% rate imposed by the U.S. in early June.
Trade groups including the Aerospace Industries Association and the General Aviation Manufacturers Association are lobbying the Trump Administration, seeking to exclude the aerospace sector from tariffs. Their main argument is that the U.S. industry has long enjoyed a healthy trade surplus and so is in no need of protection from importers, and that tariffs are proving highly disruptive to businesses and increasing costs.
At the Paris Air Show last month, GAMA president and CEO James Viola told AIN that growing numbers of Republican politicians in both the U.S. House of Representatives and the Senate are endorsing calls to exclude aviation from tariffs. According to sources close to these negotiations, who spoke on condition of anonymity, lobbyists are seeking to get wording used for the aerospace section of the UK’s trade deal with the U.S. applied as a template for trade settlements with other countries.