Business Secretary Jonathan Reynolds has warned that Britain cannot afford to impose tariffs on Chinese electric vehicles, arguing that any such move would risk retaliatory measures from Beijing that could ultimately damage the UK economy. He made the comments while speaking at the McLaren factory in Woking, Surrey.

Reynolds said that any attempt to protect UK carmakers from an influx of cheap Chinese vehicles through trade barriers would likely be met with reciprocal action from China. He warned that the resulting damage to UK exports could pose a greater risk than the imports themselves, given China's significance as a market for British manufacturers including Jaguar Land Rover, Bentley, Rolls-Royce, Aston Martin and McLaren.

Setting out his position, Reynolds said the central question was where Britain's interests lay, and that fundamentally the UK wanted to continue selling vehicles into the Chinese market, which meant that market needed to be protected. He said the UK automotive sector occupied a different position compared with the rest of Europe because of its reliance on exports, pointing to Jaguar Land Rover's sales in the United States and China as an example. He added that imposing trade protections would likely be reciprocated, leaving Britain worse off overall.

His comments stand in contrast to the approach taken by some other countries facing similar pressures from Chinese imports. Germany is preparing measures aimed at protecting strategic industries from Chinese competition, including new tariffs on hybrid electric vehicles. The European Union has also adopted a firmer stance on Chinese imports more broadly, a position notably different from that currently being taken by the UK government.

Rather than erecting trade barriers, Reynolds suggested that Britain should instead seek to attract Chinese automotive expertise and investment. He drew a comparison with the 1980s, when Nissan, Honda and Toyota were persuaded to establish manufacturing plants in the UK, suggesting a similar approach could see China's electric vehicle makers use Britain as a base for accessing the wider European market.

Reynolds pointed specifically to companies such as BYD and Geely, describing them as offering technology more advanced than what is currently available in Britain. He said the appeal of Chinese manufacturers extended beyond low cost production, noting that some of these companies were among the most innovative in the world. He said he remained open to conversations about how parts of the UK automotive sector might engage with this technology in future, and that Britain needed to remain outward facing in order to bring leading innovation into the country.

The scale of the shift in Britain's car market has been significant. Chinese brands more than tripled their share of new car sales in the UK during the first eight months of 2026, reaching 12 per cent of the market, with brands including Jaecoo and BYD becoming increasingly popular among British buyers.

However, the rapid growth of Chinese vehicle imports has raised security concerns, particularly around the possibility that these vehicles could be used to collect sensitive data on behalf of the Chinese state. The United States has taken a markedly different approach, pursuing legislation aimed at banning Chinese electric vehicle imports altogether on national security grounds. Reynolds said the UK would continue to monitor the associated risks, but that these needed to be weighed against the technological benefits such vehicles could bring to Britain.

He said the government dealt with security considerations on a case by case basis rather than applying blanket restrictions based on country of origin, adding that while the US would act according to its own interests, his responsibility was to determine what served the UK as a whole. He said security concerns remained important, but needed to be balanced against Britain's interest in accessing cutting edge technology.

Reynolds also addressed the situation at Jaguar Land Rover, confirming that the company had made no request to the government for a bailout, despite plans to cut 4,000 jobs over the next two years. He said the company had indicated it needed to adjust the size of its business to remain competitive, and that this was not linked to any specific request for government support. He added that while the public should understand that a company of that scale would periodically need to review its overall operations, Jaguar Land Rover remained a fundamentally important part of the UK economy.

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