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Lotus, the British sportscar manufacturer, is reportedly considering ceasing production at its UK headquarters and establishing a new facility in the United States, according to the BBC.
This potential shift could jeopardize 1,300 jobs at its Hethel, Norfolk base.
While Lotus declined to comment on the plans, initially reported by the Financial Times, BBC sources within the company indicate that the situation is under review, and relocating production to the U.S. is being actively considered.
The review follows a temporary suspension of production at Hethel due to disruptions caused by the implementation of tariffs on vehicles imported into the United States.
The U.S. represents a significant market for Lotus, but the tariffs, which require U.S. sellers to pay 25% tax on imported cars and parts, are posing a substantial threat to its business.
Recent figures on the UK’s car industry reveal a halving of exports to the U.S. as a result of tariffs imposed under President Donald Trump’s administration, leading some manufacturers to halt shipments.
An agreement between the UK government and the Trump administration to reduce tariffs on UK-made cars entering the U.S. to 10% is in place, but it is not expected to take effect until the end of June, meaning manufacturers have had to pay the higher rate to date.
Lotus is majority-owned by the Chinese group Geely, which is currently reorganizing its portfolio of car brands, including Volvo, Polestar, and Lynk & Co.
The company currently manufactures vehicles in Norfolk and Wuhan, China.
Founded in the early 1950s by engineer Colin Chapman, Lotus relocated to Norfolk in the 1960s.
In April, the carmaker announced 270 job cuts citing “volatile and evolving market conditions including the US tariffs”.
This decision followed previous job losses last year, but the company affirmed its “commitment to the UK” and emphasized that restructuring was “vital to enhance our competitiveness”.
In recent months, President Trump has increased taxes on a range of goods entering the U.S. in an effort to encourage businesses and consumers to prioritize American-made products.
Car shipments to the U.S., already subject to a 2.5% tariff, now face significantly higher rates.
Without a deal with the US, UK exports could have been taxed at 27.5%, as opposed to 10%. The lower tariff only applies to 100,000 British cars being imported to the US per year, matching the number of vehicles the UK exported across the Atlantic last year.
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