EU and UK Car Industries Press European Commission for Second Suspension of Brexit EV Tariffs as Battery Targets Fall Far Short

The European and UK automotive industries are urging the European Commission to suspend, for a second time, tariffs on electric vehicle imports under the EU-UK Trade and Cooperation Agreement, after confirming they will be unable to meet the battery manufacturing targets required for tariff-free trade from 1 January 2027. Under the 2020 Brexit deal, 55% of a car's value and 70% of its battery pack had to be made in Europe to qualify for tariff-free status by that date. A first suspension was agreed in 2024 after the industry missed earlier milestones. With seven months now remaining, the industry's own estimates show that only "just under 20%" of EV batteries will be manufactured in the EU by January 2027 — far below the required threshold. The UK's domestic production level is higher but also below target. ACEA (the European Automobile Manufacturers' Association), whose director general is Sigrid de Vries, has called for a "policy shift" at the Commission. SMMT (the UK's Society of Motor Manufacturers and Traders) chief executive Mike Hawes warned that battery supply chains "are still not ready" and called on the UK and EU to find "a pragmatic solution that avoids self-defeating tariffs on the very vehicles consumers are being urged to buy." The European Commission confirmed it is "in constant contact with stakeholders" but has not committed to a further suspension. European leaders are due to meet on 18 June, with China's industrial dominance in battery materials on the agenda. European battery manufacturing costs remain around 30% higher than Chinese equivalents, and opening a mine and building a full lithium production chain requires approximately $750 million and several years of lead time.

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