Minister responds to fears of global recession as Trump tariffs cause market chaos

Transport Secretary Heidi Alexander has responded to fears of a global "bloodbath" as Donald Trump's tariffs cause chaos around the .

The US President has slapped a 25% tariff on foreign car imports, and 10% on all other goods, sparking a string of retaliatory measures. Asian markets plunged on Monday following last week's two-day meltdown on Wall Street.

Pressed by Sky News host Wilfred Frost on whether Trump's measures would lead to a global , the frontbencher admitted that global tariffs are "bad news". She said: "So the imposition of global tariffs and the reciprocal tariffs that some countries have and retaliatory tariffs that some countries have decided to apply, are bad news for the global economy, because it's bad for global demand, it's bad for prices and it's bad for consumers, and so that is why we have to do everything that we can to protect the interests of the British people and British businesses."

She said the Government will announce a string of moves to protect car manufacturers, stating: "And that is why we are setting out a package of support today for the car industry to provide certainty to British manufacturers and to ensure that they can remain at the cutting edge of the transition to electric vehicles, and also make sure that consumers can benefit from the cheaper running costs of electric vehicles as well.

"And so that's why the Prime Minister has been clear that we need to do absolutely everything we can as a government to shelter British businesses from these global economic headwinds."

READ MORE:

The US president said he would not back down on tariffs unless countries even their trade balance with the US. Speaking on Air Force One on a flight back to Washington, Trump said he did not want global markets to fall, but that "sometimes you have to take medicine to fix something". He also said he had spoken to leaders from around the world.

"They're dying to make a deal," he said. "And I said, we're not going to have deficits with your country. We're not going to do that, because to me a deficit is a loss. We're going to have surpluses or, at worst, going to be breaking even."

Jaguar Land Rover said over the weekend that they would "pause" shipments to the US, as they look to "address the new trading terms". As part of his announcement in the West Midlands, Mr Starmer will reinstate the 2030 ban on the sale of new petrol and diesel cars.

Describing the car sector as "the engine room of British industry", he wrote in The Times: "We want British car companies to be at the forefront of the electric vehicle revolution at home and overseas." He also said that "in this new era of global instability we will go further and faster to support businesses and workers".

The PM said today's measures will be "just the first in a series" of announcements from the Government, designed to provide "certainty" and "support for industry". The PM spent the weekend in calls with foreign leaders about the tariffs, after he promised to do "everything necessary" to protect Britain's national interest.

After calls with the leaders of France, Italy and in recent days, Sir Keir used conversations with European Commission president Ursula von der Leyen, German Chancellor Olaf Scholz and leader of the German Christian Democratic Union party Friedrich Merz, to reiterate his disappointment at the measures announced by the White House.

Regulations around manufacturing targets on electric cars and vans will also be altered, to help firms in the transition, and new hybrids will be on the market for another five years. Luxury supercar firms such as Aston Martin and McLaren will still be allowed to keep producing petrol cars beyond 2030, because they only manufacture a small number of vehicles per year.

New hybrids and plug-in hybrid cars will be allowed to be sold until 2035. Petrol and diesel vans will be able to be sold until 2035, as well as all hybrid models. Officials are also going to make it easier for manufacturers who do not comply with Government-mandated sales targets to avoid fines, and the levies will be reduced.

READ MORE: