11:06 am, December 23, 2022
Key figures in the heart of the government have raised fears that plans put forward by Joe Biden could destroy the British car industry, it has been reported.
The US President’s administration recently announced proposals to subsidise companies investing in net-zero products made on the other side of the Atlantic.
However, the same benefits would not apply to products made in the UK, which could have a profound affect on the export of vehicles to America.
The market is currently worth £4.3bn and ministers are concerned that Biden’s new policy will undermine ‘free and fair trade’ with the UK .
Among those said to have reservations is trade secretary Kemi Badenoch, who was has written to her opposite number in Washington to ‘express her alarm’.
The Times reports that PM Rishi Sunak is also expected to discuss concerns directly with the White House.
The worries are in relation to the Inflation Reduction Act, which was passed by the US Congress back in August.
The act means that US companies that commit to investment in net-zero technology will be eligible for up subsidies of up to to $360bn.
The subsidies, which also include tax credits, are worth around $7,500 per vehicle sold.
Reacting to the news, the SMMT called for ‘free and fair trade’ between the UK and US markets.
Mike Hawes, CEO of the trade body, said: ‘Measures that support free and fair trade between us should be encouraged, rather than those that seek to protect individual markets.
‘The SMMT is in dialogue with government to ensure that UK-made electrified vehicles, batteries and critical components continue to compete fairly in the US market and support the administration’s target.’
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