Britain was once a giant of car manufacturing. In the 1950s, we were the second-largest producer in the world and the biggest exporter. Coventry, Birmingham, and Oxford built not just cars, but the reputation of an industrial nation; to this day, it is a source of great pride that Jaguar–Land Rover, a global automotive icon, still stands between Coventry and Birmingham. By the 1970s, we were producing more than 1.6 million vehicles a year.
Today? We have fallen back to 1950s levels. Last year, Britain built fewer than half our peak output—800,000 cars, and the lowest outside the pandemic since 1954. Half a year later, by mid-2025, production has slumped a further 12%. The country that once led the automotive revolution is now struggling to stay afloat, and fighting to remain relevant.
This is why the news that BMW will end car production at Oxford’s Mini plant, shifting work to China, is so damning, bringing this decline into sharp focus. The Mini is not only a classic British car; Alec Issigonis’s original design made it an international icon. For decades, the Mini has been the bridge between British design flair and foreign investment. Its departure leaves 1,500 jobs at risk at a time when the government is desperate to fuel growth and convince a wavering consumer market that there is no tension between industrial production and Net Zero goals.
It’s a bitter reminder that we in Britain have been here before: letting an industrial crown jewel slip away.
The usual explanations will be offered: global competition, exchange rates, supply chains. All true, in the midst of a global trade war that is heating up and damaging major British exports. But such a diagnosis is incomplete. The truth is that Britain’s car industry is being squeezed by a mix of geopolitical realignment and government missteps.
The car industry has become the frontline of a new trade war. Washington has already moved aggressively to shield its own firms: the Inflation Reduction Act offers vast subsidies for US-made EVs and batteries, an unapologetic attempt to onshore production, and something that became a flashpoint of tension in Trump’s negotiation with the EU in the latest trade deal. On the production side, the Act has poured billions into US manufacturing: investment in EV and battery plants hit around $11 billion per quarter in 2024.
Ripples have been sent across the world in the US’s wake: Europe, faced with a flood of cheap Chinese EVs, has imposed tariffs of up to 35% after an anti-subsidy investigation. Talks have even turned to a system of minimum import prices instead of tariffs. Unsurprisingly, China has threatened retaliation against European luxury marques, while experts warn the tariffs may slow the EU’s green transition by raising prices.
This is no longer a free market: cars are treated as strategic assets, the 21st-century equivalent of shipbuilding or steel. Whoever controls the supply chains, particularly for EV batteries and the mining of lithium, controls not only the future of the industry but an important lever of national power.
The results are visible. In July 2025, Tesla’s UK sales collapsed nearly 60%, while Chinese giant BYD’s deliveries quadrupled. Europe responded by talking up new tariffs. Britain did nothing. In this asymmetric contest, our market risks becoming a showroom for foreign producers—subsidizing both sides of the trade war without defending our own.
The real danger is not simply that Britain loses factories—that would be lamentable, but new industries crop up all the time. The danger comes if Britain misreads the geopolitics of the moment. Policymakers assume that globalization still works on liberal lines, when in reality industrial competition has become nakedly political.
If the government continues to approach this as a morality play about “green obligations” rather than a contest of state-backed strategies, Britain will find itself outmaneuvered by rivals who are willing to fight dirty. The naivety of this government in the geopolitical realm is already on show—all it takes is an unscrupulous actor to take advantage.
Meanwhile, Britain’s car industry is being crushed under the weight of its own government’s Net Zero agenda.
Hellbound and Down 