The Jaguar Land Rover (JLR) has stopped shipments to the United States for the next month as it considers its response to President Donald Trump’s 25% tariff on imported vehicles. The new tariff regime means the importer is expected to pay the tariffs before the importation of items including trucks, SUVs, cars, auto parts, and their components.
This move by JLR is expected to affect its profits, as the US market accounts for about 25% of its global sales. Already, the US is the largest market for its flagship vehicles like its full-size Range Rover, Range Rover Sport, and Land Rover Defender. These vehicles account for huge profit margins for the company.
The sweeping tariff won’t affect competing brands like Mercedes-Benz and BMW, which have large plants in Alabama and South Carolina—affording them the luxury of manufacturing SUVs for the American and global markets. JLR doesn’t have a manufacturing presence in the US and relies entirely on imports from the UK into the US. There are speculations that JLR would consider establishing a new $1 billion plant in the US to stay relevant in the automotive market.
Reuters reports that shares of India’s Tata Motors, which owns Jaguar Land Rover sank by 10% on Monday, April 7, and is set for their worst day in over three years.
The slide on the day has taken the stock’s tumble to 22% since Trump announced the import duties on March 26.
