Industry Topics

Brexit

SMMT Position

The British public has chosen a new future out of Europe and safeguarding automotive interests will be a priority for SMMT in the coming months. Government must now maintain economic stability and secure a deal with the EU which safeguards UK automotive interests. UK automotive will work closely with government in this transition period to ensure interests of sector, jobs and investment are safeguarded and future competitiveness of this industry is secured. This includes securing tariff-free access to European and other global markets, ensuring we can recruit talent from the EU and the rest of the world and making the UK the most competitive place in Europe for automotive investment.

Read our latest discussion paper on Brexit that outlines our full position: Delivering UK Automotive Brexit priorities.

Statement following Prime Minister’s Mansion House speech

Mike Hawes, SMMT Chief Executive, said:

The PM was right to recognise the importance of integrated supply chains and borders free from quotas and tariffs for key sectors such as automotive. Barrier free access to the EU market and complete regulatory convergence have been the foundation of our success.

There is no escaping the fact that being out of the customs union and single market will inevitably add barriers to trade, increase red tape and cost. Settling for “good” access to each other’s markets is not enough as it will only damage the UK’s competitiveness and reduce our ability to attract investment and the high quality jobs that go with it.

Brexit is finally being recognised as a highly complex and difficult negotiation which is why we urgently need a transitional arrangement which allows business to continue as normal until the UK’s new trade arrangement with the EU has been agreed and implemented.

 WTO export tariff automotiveWTO import tariff automotive

Brexit priorities

  • Government must provide economic stability and reduce uncertainty. Competitiveness must be safeguarded and a clear indication of likely timing, intent and ambition must be established so as not to deter potential investors.
  • We need unrestricted access to the single market of Europe, our largest trading partner. This is essential not just for the import and export of vehicles but also for the trade of components essential for the production of vehicles and other automotive products in the UK.
  • We need to ensure we have a voice in European regulatory policy – helping shape the laws that affect the cars we buy and the cars we build. This is essential to protect the interests of UK companies. (The legal situation remains the same and it will take two years plus to negotiate our relationship with the European Union.)
  • We need to ensure we can still employ people from the EU to meet our urgent skills needs we cannot fill locally. UK automotive currently has over 5,000 vacancies in the sector and these positions need to be filled if growth is to continue. We need free movement of labour within European borders- any restriction undermines a global industry like automotive. For UK advanced manufacturing there is a shortage of qualified scientists, engineers and technologists. Government and industry needs to urgently address this skills gap.
  • We will continue to play a full and active part in regulatory agenda setting at a UN level.

EU workers in UK automotive manufacturing sector

Impact of Brexit

SMMT analysis suggests that EU tariffs on cars alone could add at least an annual £2.7 billion to imports and £1.8 billion to exports.

Import tariffs alone could push up the list price of cars imported to the UK from the continent by an average of £1,500 if brands and their retail networks were unable to absorb these additional costs.