Trade Resources Company News UK Car Industry Seek Clarity From Theresa May on Brexit

UK Car Industry Seek Clarity From Theresa May on Brexit

Chief executives from automotive industry are seeking urgent clarity from the UK Prime Minister Theresa may on Brexit.

Executives from companies such as Jaguar Land Rover, McLaren, Bentley, Nissan, Honda, Toyota and BMW met with May to discuss about the gravity of the situation, if the UK moves out of EU without any trade deal.

The auto industry stated that lack of any trade deals with the European Union, could make it difficult for the industry as World Trade Organisation’s (WTO) tariffs will be imposed on the UK.

It is expected to result in loss of global competitiveness for automakers in the UK.

The industry heads alleged that the country is hardly making any progress negotiating deals with the Union and there should be some clarity within months about its plans and warned that investment decisions cannot be delayed any longer.

The industry warned that not only competitiveness, but in turn jobs could be lost to other countries. Telegraph reported that the country yearly produces 1.7 million vehicles and around 80% of them are exported. This accounts for 13% of the country’s total goods exported. If WTO tariffs are imposed, it could add up to £4.5bn per year.

Not only this, imposition of customs can also affect the industry, as 40% of the total auto-spares in the country have to be imported from outside, leading to increase in cost of manufacture. This can reduce the viability of auto-plants in the country.

On the other hand, Automotive News reported that the Theresa May and Business Minister Greg Clark stated that they were aware of the situation, but cannot guarantee anything, as negotiations are not complete.

The trade body, the Society of Motor Manufacturers and Traders (SMMT) in a statement said: “The meeting focused on our members’ Brexit priorities - in particular, the urgent need for clarity on the proposed transition agreement as business needs certainty to invest.”

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Topics: Auto Parts