Car industry urges Government to rule out no-deal Brexit ~ station of gear

Hugo Griffiths 2018-09-19 08:00

SMMT says no-deal is “no option” for auto industry, warning hard Brexit tariffs of £5 billion are “tip of the iceberg”

Nissan Leaf long termer first report - front factory

The Society of Motor Manufacturers and Traders (SMMT) has issued its starkest warning yet that a no-deal Brexit would be disastrous for the UK’s automotive industry.

Citing increased costs to industry and consumers, driven by tariffs, of £5 billion, the SMMT warns a no-deal Brexit is “no option” for the industry. The trade association says the industry is being pushed closer to a “cliff edge” by limited Brexit progress.

The news comes in the same week Jaguar Land Rover put 3,000 staff at its Castle Bromwich factory on a three-day working week, and MINI confirmed its factory in Oxford would shut for a month the day after the UK leaves the EU.

• UK driving licences could be invalid in EU countries

If the UK leaves the EU without a deal, World Trade Organisation (WTO) export tariffs of 9.8 per cent would apply to cars made in the UK sent to Europe. By the SMMT’s calculations a no-deal Brexit would add £2,700 to the cost of a UK-made car sold in the EU, affecting manufacturers’ profitability, and putting jobs at risk. The automotive sector supports 856,000 jobs in the UK.

Furthermore, the cost of buying an EU-made car in the UK would rise by £1,500 if companies are not able to absorb additional costs. Last year, 1.9 million EU-made cars and vans were bought in the UK.

• Brexit offers "no advantages" for UK carmakers

Mike Hawes, chief executive of the SMMT, said: “Tariffs alone should be enough to focus minds on sealing a withdrawal agreement between the EU and UK, but the potential impact of ‘no-deal’ means the stakes for the automotive sector are far higher.”

The SMMT is meeting with EU representatives today in Brussels, and Hawes said he was looking to negotiators to “act swiftly to avoid disruption and damage to one of our most valuable shared economic assets.”

No deal Brexit could add 10 per cent to the cost of German cars...

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