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U.S. issues new tariff threat, this time against British-built cars

WASHINGTON — Britain is the United States' closest ally but their long friendship may be sorely tested as the two countries try to forge a new trade agreement after Britain's exit from the European Union. U.S. Treasury Secretary Steven Mnuchin said on Saturday in London that he was optimistic that a bilateral deal with Britain could be reached as soon as this year. But Mnuchin gave up no ground after a second meeting with his UK counterpart, Sajid Javid. Javid has insisted that Britain will proceed with a unilateral digital services tax, despite a U.S. threat to levy retaliatory tariffs on British-made autos. Mnuchin told reporters after Saturday's meeting that such taxes would discriminate against big U.S. tech companies like Alphabet Inc's Google, Apple, Facebook and Amazon. The UK Treasury declined to comment on the private meeting. The divide highlights the challenges ahead as the Trump administration seeks a new bilateral agreement with Britain, part of a broader push to rebalance relations with nearly all its major trading partners. The stakes are high — British Prime Minister Boris Johnson has pegged the trade deal with United States as a way to ease the pain of breaking with Europe, Britain's largest trade partner. U.S. President Donald Trump, has promised a "massive" trade deal to support Brexit, the product of a populist movement similar to his "America First" agenda. The goodwill and special relationship the two countries have enjoyed for decades may not count for much, experts say. "Trump is not going to be doing Johnson any favors," said Amanda Sloat, a senior fellow with the Brookings Institution in Washington. "He's not going to give him a trade deal without major concessions." Even before the digital tax issue arose, the Trump administration threatened to tax foreign car imports, which could hit British-made Jaguar, Land Rover, Mini, and Honda Civic hatchback cars. Stiff U.S. trade demands include increased access for U.S. farm goods, concessions that will be difficult for Britain's entrenched natural food culture to swallow. The United States also wants Britain to change the way its National Health Service prices drugs and allow in more U.S. pharmaceuticals, which could prove politically unpopular for Johnson's government. Washington's demand that London block Chinese telecoms equipment maker Huawei Technologies Co Ltd for national security reasons could also cloud talks.

Jaguar celebrates 60 years of the E-Type with six pairs of restomod cars

Jaguar is celebrating 60 years of the E-Type — which was known as the XK-E in the United States — by giving 12 cars a full in-house restoration that includes a handful of 21st-century updates. Sold exclusively in pairs, the six coupes and six convertibles are inspired by the cars shown in Geneva during the model's introduction in 1961. Developed to replace the XK150, the E-Type was presented to the public and the press on March 15, 1961, at the Geneva auto show. Two examples made the trek from England to Switzerland: a gray coupe wearing registration number 9600 HP and driven by publicist Bob Perry, and a green roadster registered 77 RW put in the hands of official Jaguar test driver Norman Dewis. Both cars were driven to the event; the coupe arrived in Switzerland minutes before it was scheduled to make its debut, and the roadster was rushed to Geneva the following day. Jaguar chose not to re-release either car. Instead, it will paint the six coupes in a special shade called Flat-Out Grey, and it will give the six convertibles a coat of Drop Everything Green. It pointed out that both colors were created specifically for the 60 Edition models, and that neither will be used on another car. Edition-specific emblems created by Jaguar's design department appear on the hood and on the fuel cap, among other parts. Jaguar E-Type 60 Edition View 11 Photos Sitting in the cabin is like traveling to the 1960s. The driver faces a wood-rimmed steering wheel with drilled spokes (and a non-original 24-carat gold horn button), analog gauges, and an array of switches on the dashboard. Coupes receive Smooth Black leather upholstery, while convertibles get Suede Green leather. Don't look for power windows or automatic headlights. You'll need to manually roll down the windows and turn on the headlights. There's tech if you look, however. Jaguar concealed a modern infotainment system with satellite navigation and Bluetooth connectivity, for example. While that's available on any of the resto-modded E-Types the firm builds, the 60 Edition cars stand out from with an engraving of the route from Jaguar's headquarters in Coventry to Geneva, Switzerland, on the center console. It's created by hand in 100 hours by Johnny Dowell, who also goes by the name King Nerd. On the coupe, the engraving reads "I thought you'd never get here," words spoken to Perry by Jaguar founder Sir William Lyons after he arrived in Geneva.

The UK votes for Brexit and it will impact automakers

It's the first morning after the United Kingdom voted for what's become known as Brexit – that is, to leave the European Union and its tariff-free internal market. Now begins a two-year process in which the UK will have to negotiate with the rest of the EU trading bloc, which is its largest export market, about many things. One of them may be tariffs, and that could severely impact any automaker that builds cars in the UK. This doesn't just mean companies that you think of as British, like Mini and Jaguar. Both of those automakers are owned by foreign companies, incidentally. Mini and Rolls-Royce are owned by BMW, Jaguar and Land Rover by Tata Motors of India, and Bentley by the VW Group. Many other automakers produce cars in the UK for sale within that country and also export to the EU. Tariffs could damage the profits of each of these companies, and perhaps cause them to shift manufacturing out of the UK, significantly damaging the country's resurgent manufacturing industry. Autonews Europe dug up some interesting numbers on that last point. Nissan, the country's second-largest auto producer, builds 475k or so cars in the UK but the vast majority are sent abroad. Toyota built 190k cars last year in Britain, of which 75 percent went to the EU and just 10 percent were sold in the country. Investors are skittish at the news. The value of the pound sterling has plummeted by 8 percent as of this writing, at one point yesterday reaching levels not seen since 1985. Shares at Tata Motors, which counts Jaguar and Land Rover as bright jewels in its portfolio, were off by nearly 12 percent according to Autonews Europe. So what happens next? No one's terribly sure, although the feeling seems to be that the jilted EU will impost tariffs of up to 10 percent on UK exports. It's likely that the UK will reciprocate, and thus it'll be more expensive to buy a European-made car in the UK. Both situations will likely negatively affect the country, as both production of new cars and sales to UK consumers will both fall. Evercore Automotive Research figures the combined damage will be roughly $9b in lost profits to automakers, and an as-of-yet unquantified impact on auto production jobs. Perhaps the EU's leaders in Brussels will be in a better mood in two years, and the process won't devolve into a trade war. In the immediate wake of the Brexit vote, though, the mood is grim, the EU leadership is angry, and investors are spooked.