With his car tariffs, Donald Trump has just declared economic war on Britain

The government has only a few days to help prevent some serious damage to the British car industry. They will be well aware that the UK exports some £6bn worth of vehicles to the US, and the trade is vulnerable to the 25 per cent tariffs planned – and indeed publicly signed into force – by Donald Trump, due to come into effect on 2 April.

As you read this, consignments of Range Rovers and Bentleys are hurriedly making their way to the United States to beat the tax. It’s not enough to kill off growth in the UK economy – the car industry represents 0.2 per cent of GDP, and it’s not going to be wiped out entirely – but it doesn’t help post-Brexit, and it will hurt badly in certain areas. The Wolverhampton constituency of Pat McFadden, for example, one of Keir Starmer’s closest cabinet colleagues, would be one, with many there depending on the Jaguar Land Rover engine plant for their livelihoods. Jobs will be lost.

It feels like an act of economic war, and that is what it is. The trade wars Trump is triggering are against almost the whole world, including America’s most active trading partners and investors. It will depress the world economy, and it is not rational. As Trump sees it, “allies are often worse than enemies”, singling out Canada and the European Union for particular ire. They seem ready to reciprocate, and things can quite easily escalate, as they did in the 1930s.

Trump being Trump, trade policy won’t be kept in a separate compartment – he could quite easily swap a carve-out on the tariffs in return for the UK dropping the digital services tax, which would cost Rachel Reeves £800m. If countries retaliate, then Trump could do the same. But he could also threaten them with withdrawing their defence guarantees, Nato or not, or ending scientific or cultural cooperation, restricting visas for workers and visitors. Everything is on the table. He won’t care.

The great irony is that the one country where Trump is talking about relaxing trade restrictions and lifting sanctions is Russia. Although he hasn’t yet been tricked by the Russians into doing so – they craftily inserted the idea, unilaterally, into one of the “readouts” from the Ukraine peace talks in Jeddah – it is no secret that Trump and his team are hell-bent on normalising relations with Russia as soon as possible, and that Ukraine is not going to be allowed to get in the way of that deranged strategic goal. Sooner or later, Russia will be granted the most favourable economic relationship with the US of any nation on earth. That’s the measure of the revolutionary change in geopolitics Trump is bringing about, even if many don’t quite believe what is happening before their very eyes.

What should Britain do? Keep calm and carry on negotiating would be the sensible and rational response. The UK doesn’t import much in the way of steel, aluminium or cars from America, and, sadly, lacks the heft to be able to intimidate the US. The EU and China have far more clout, but even they are victims of Trump’s aggression (though it will be American consumers and businesses who pay the higher price).

We can’t even slap a spiteful but satisfying tariff on Tesla cars because most of the ones in British showrooms are made in Germany or China. A voluntary buyer’s boycott would be much more effective. We do import some models from the US, but they tend not to carry familiar American nameplates: the BMW X5s made in Spartanburg, South Carolina, but with engines made in Germany, is one such example.

You can see why this intensely integrated industry hates tariffs and trade restrictions such as those we created after Brexit. In any case, raising UK tariffs on US imports would simply mean more expensive cars for British families, and there’s no reason to do that. The bigger risk is that Trump would ask his cronies in the Oval Office why America shares sensitive intelligence so freely with the British (no sense or irony), let alone the Trident nuclear missile technology. You can see that ending badly for the British, and it making no difference to this White House.

In trade wars, everyone loses, but some more than others. Best to keep our heads down and hope those rich Americans will pay a little more for their Bentley Continentals.