CEO Update

From drawing board to negotiating table, dialogue delivers success

02 February 2024 #CEO Update

As trade talks continue between the UK and countries around the world, from major markets to growing economies, it is essential that automotive is at the heart of negotiations. As an industry built on global trade and, indeed, our role as Britain’s largest goods export sector by value, forming deeper ties with international partners makes eminent sense. Not only does it give a green light for businesses to gain new opportunities – benefitting our industry and workforce as well as the British economy as a whole – but it also gives consumers choice at home and abroad.

Last week’s suspension of trade talks with our eighth largest export market for cars, Canada, was disappointing but a reflection of the state of the discussions. Trade deals are not sector specific but encompass a range of products and sometimes services – and the cause of the breakdown in these discussions looks to be focused on issues affecting other sectors, especially agriculture. For automotive, Canada has phased out its 6.1% tariff on cars following a long transition period but recently introduced high ‘behind the border’ luxury taxes affecting many of our automotive products. Our sector believes in free and fair trade, so a balanced deal needs to be struck – one that seeks to improve reciprocal market access but also recognises the UK sector’s integration within the European automotive industry.

Therefore, a temporary extension for European parts and components where they are used is needed to avoid duties, while a modernised deal is finalised and brought into effect – else tariffs could be reintroduced from April. Many of our companies are looking to export to Canada and the current position could be interpreted as a signal that our first class automotive products are not welcome in a close ally across the Atlantic. That would benefit no one, not least Canadian consumers, so we urge all parties to get back around the negotiating table.

Smart policymaking and strong trading relationships are particularly critical as markets for next-generation connected and automated vehicles grow and, nearer to home, industry is closely following the Automated Vehicles Bill. Legislative approval is possible as early as the Spring and the sooner the better, to put the UK in a leading position as a global innovator not just in manufacturing but regulation and the rollout of this inevitable transition. Constructive dialogue between industry and government will be crucial, and that makes this year’s SMMT Connected on 14 March as timely as ever. Dr Céline Laurent-Winter, BMW Group’s Vice President Connected Vehicle Platforms, is the latest keynote speaker to be announced, with some tickets still available. Registration is now also open for the Commercial Vehicle Show 2024 from April 23-25, always a major event for fleet operators to meet product experts and to invest in the very latest, greenest truck and van tech

After all, our sector’s success depends on collaboration between people, within Britain and internationally, and UK Automotive benefits from its diversity of bright minds and leaders. SMMT is proud, therefore, once again to support Autocar’s Great Women awards, highlighting the exceptional women that are driving our mobility revolution, and SMMT will continue to help our industry deliver mission-critical progress in all its forms.

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