CEO Update

Decisive action needed to safeguard future of UK automotive

15 February 2019 #CEO Update

Used car sales figures were released by SMMT this week, with the UK market ending 2018 -2.1% down on the year before. With only 167,980 fewer second hand cars changing hands during the 12 months it was the third highest year on record, and the fall was less than the -6.8% drop seen in the new car market during 2018.

It’s encouraging that used car sales have held relatively strong – a robust used car market is essential to keeping the new car market healthy. It is also good to see that alternatively fuelled vehicles have made strong advances since 2017 – growth continuing last year with a 26.9% rise. That said, the overall proportion of used transactions that were AFVs is still low – just over 100,000 out of almost eight million.

If we are to meet strict environmental targets then encouraging uptake of the latest, cleanest petrol, diesel and electrified powertrains by new car buyers is vital in order to see average emissions levels drop across the UK’s road fleet as these models filter down through the used car market.

Elsewhere, this week has seen more parliamentary votes on Brexit, but none of them substantive decisions on a final deal and without consensus in parliament the prime minister is still a long way from securing ratification for her deal. 29 March might be the political deadline for a decision on Brexit, but we all know that businesses in the automotive industry are having to make decisions about the future much sooner than that.

It’s extremely frustrating that we still don’t know what the regulatory and trade landscape looks like in 42 days’ time, and there are far longer lead times than that when it comes to making manufacturing and new model decisions. We’ve already seen in recent weeks the impact that Brexit procrastination is having on our sector.

We need certainty now – it’s vital that ‘No Deal’ is taken off the table and that progress is made towards a future relationship that safeguards frictionless trade and the hundreds of thousands of jobs that depend on UK Automotive. The UK signed a continuity trade deal with Switzerland this week that will provide status quo trading terms, but we’ll need many more of those to replace the 40-plus trading agreements we could lose in the event of ‘No Deal’.


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