Britain's defense capabilities could be jeopardized by proposed new steel tariffs, according to industry leaders who supply specialized materials for the nation's military programs. They warn that a planned 50 percent levy on imported steel, set to take effect on July 1, could lead to significant cost increases and delays, potentially grounding fighter jets and hindering the maintenance of nuclear submarines.
Suppliers argue that the tariffs, intended to bolster the domestic steel industry, may instead cripple critical defense supply chains. Sonja Skelton, director of West Special Fasteners, which provides parts for the UK's submarine fleet, stated that the increased costs could cause delays in planned maintenance for submarines returning from tours. "It's going to affect the ability to defend ourselves as a country," Skelton said.
Alex Bailey, co-director of Dynamic Metals, a firm that supplies specialist steel for military aircraft under Ministry of Defence contracts, faces an estimated £3.5 million increase in costs due to the tariffs. He expressed fear for his business and its 75 employees, calling the plan "madness" and warning it could lead to delays in aerospace defense development as manufacturers seek to avoid the tariffs. "At the very least, it will put the prices up on aircraft, which will put strain on the government, which is already tight on expenses," Bailey noted. His co-director, Sam Excell, added that such damage could be permanent, potentially leading to a loss of manufacturing expertise that would not return.
This situation arises as reports indicate that all five of Britain's nuclear submarines are currently docked awaiting maintenance. Industry insiders fear the tariffs will exacerbate these existing issues.
Ministers maintain that the tariffs are a necessary response to global market shifts. They argue that the UK risks becoming a "dumping ground" for cheap, state-subsidised foreign steel, particularly from China, if no action is taken. The government points out that the U.S., Canada, and the European Union have already implemented similar tariffs. "If we do not act, we will not have steelmaking in the UK," stated Industry Minister Chris McDonald, noting that only 30 percent of steel used in Britain currently comes from domestic mills.
The timing of the tariffs is also a point of concern, coinciding with reports that the government is considering a reduction in the defense budget. Former Defence Secretary John Healey resigned earlier in June, warning that proposed defense pledges fell "well short of what is required" and could "make the country less safe." Excell believes the planned tariffs will erode any savings from a reduced budget, as costs for defense projects will inevitably increase. "That £13.5 billion will be severely hampered by the 50 per cent tariffs on a lot of steels and alloy steels that are used in these projects," he said.
Beyond defense, the tariffs are expected to impact other major infrastructure projects and industries. Dynamic Metals also supplies steel for commercial aircraft, Formula 1 teams, and wind turbines. Excell highlighted potential impacts on projects like HS2 and the Hinkley Point power station.
Industry insiders also question the practical effectiveness of the tariffs in rapidly rebuilding the domestic steelmaking capacity needed for defense applications. The accreditation process for mills supplying specialized defense-grade steel can take years, a timeline that does not align with the July 1 implementation date. This gap could lead to restricted supplies and potentially higher prices from the limited number of domestic mills that can qualify.
Liberal Democrat MP Victoria Collins criticized the government's approach, stating, "At a time when we're focused on strengthening Britain's defence, resilience and economic security, the last thing we should be doing is making life harder for British manufacturers." She argued that the policy risks weakening the industrial base rather than preserving it. Companies, including Airbus, have participated in parliamentary discussions expressing concerns about the tariffs' broad ramifications.
A spokesperson for the Department for Business and Trade asserted that the measures aim to "strike the right balance between protecting domestic production and maintaining a secure supply." They added that quotas would allow businesses to import sufficient steel tariff-free to avoid unnecessary costs.