An unexpected development at the G7 Summit in Kananaskis, Canada saw U.S. President Donald Trump and U.K. Prime Minister Keir Starmer announce a partial trade agreement centered on automotive and aerospace sectors, leaving steel and aluminum tariffs unresolved.

The agreement allows up to 100,000 U.K.-made vehicles annually into the U.S. under a reduced 10% tariff, significantly down from the previous 25%. U.K. aerospace products, including aircraft and components, will now enjoy full tariff exemptions, benefiting manufacturers like Rolls-Royce.

The most contentious issue-metal tariffs-remains in limbo. The U.S. has opted for a provisional import quota system rather than an outright resolution. Without a finalized pact, tariffs could rise to 50% on British steel starting July 9.

The agreement also includes limited agricultural access, such as the bilateral trade of 13,000 metric tons of beef and an aim to streamline ethanol exports, though regulatory alignment is still pending.

Both leaders praised the pact: Trump called the moment a demonstration of a "fantastic relationship," while Starmer declared it a "day of strength" for economic ties.

Notably, pharmaceuticals and digital trade were left out of this deal and will require further negotiation. While the benefits in autos and aerospace will be implemented within days, the fate of metals remains uncertain, highlighting global trade complexities and strategic supply chain debates.