A new trade agreement between the US and UK will remove tariffs on Rolls-Royce engines exported across the Atlantic, following a carve-out included in a freshly negotiated deal. This deal will also see a UK airline purchase $10bn worth of Boeing aircraft, US Secretary of Commerce Howard Lutnick confirmed.
These moves are expected to ease transatlantic trade tensions and offer a boost to both the US and UK aerospace sectors.
In the first trade deal to be completed between the Trump administration and a foreign economy, following the US President’s implementation tariffs on economies around the world at the beginning of April, the UK has seen levies on steel and aluminium removed. A baseline tariff of 10% on UK imports will still apply.
At a conference in the Oval Office, Trump announced these new measures, with Lutnick stating: “[The UK] sell Rolls-Royce engines to Boeing. We've agreed to let Rolls-Royce engines and those kind of plane parts to come over tariff-free."
In addition to tariffs on Rolls-Royce engines being scrapped, Lutnick indicated that a $10bn deal with Boeing was a private-sector purchase, noting that he would let the airline making the deal announce the details. The White House's graphic with general terms of the deal referred to $10bn in "aircraft parts" purchases, without further details.
British Airways’ parent company bought 32 new Boeing planes from the US, it announced on May 9, 2025. The International Airlines Group (IAG) confirmed the order of the Boeing 787-10 aircraft for its BA fleet, alongside 21 Airbus planes for its other airlines. The group further disclosed that it had exercised options for an additional 18 aircraft in March, including six A350-900s, six A350-1000s, and six 777-9s.
In the wake of the trade deal, Trump posted on his Truth Social platform commenting: “The agreement with the United Kingdom is a full and comprehensive one that will cement the relationship between the United States and the United Kingdom for many years to come."
He added: “Many other deals, which are in serious stages of negotiation, to follow!"
Following the deal all major US indexes grew by more than 1%, with the S&P 500 is up 1.34%, the Dow is up 1.32% and the NASDAQ up 1.78%.