Calls grow for further delay to UK–EU electric vehicle tariff rules
10 June 2026
Automotive industry leaders are calling on the UK and EU to delay the introduction of stricter Rules of Origin requirements for electric vehicles, warning that businesses may struggle to meet the new thresholds before they take effect in 2027.
The Rules of Origin provisions under the UK–EU Trade and Cooperation Agreement determine whether vehicles qualify for tariff-free trade between the UK and EU. To benefit from zero tariffs, manufacturers must demonstrate that a sufficient proportion of a vehicle's value originates in the UK or EU.
The automotive sector has already secured one extension to the current arrangements, but industry groups are now lobbying for a further delay, arguing that battery supply chains have not developed quickly enough to meet the upcoming requirements.
Without additional flexibility, some electric vehicles and components traded between the UK and EU could become subject to tariffs, increasing costs for manufacturers, suppliers and consumers.
Industry groups on both sides of the Channel, including automotive manufacturers and trade associations, are urging policymakers to consider a further extension. They argue that battery supply chains and domestic production capacity have not yet developed sufficiently to enable many manufacturers to meet the stricter origin thresholds due to apply from 2027.
For UK exporters, the implications could include:
- Reduced competitiveness in EU markets
- Higher costs for vehicles and automotive components
- Supply chain restructuring to meet origin requirements
- Increased compliance and documentation requirements
UK importers may also be affected, particularly businesses sourcing vehicles or components from EU suppliers. Any tariffs introduced could increase costs throughout the automotive supply chain and place additional pressure on pricing.
The issue is particularly significant because the UK and EU automotive industries remain highly integrated, with components often crossing borders multiple times during production.
While discussions continue between industry representatives and policymakers, businesses involved in automotive manufacturing, importing and exporting should monitor developments closely and review their exposure to future Rules of Origin requirements.
The outcome of these discussions could have important implications for the future competitiveness of the UK automotive sector and its trading relationship with the EU.
By Carla Assunção, Chamber International
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