Industry Topics

Brexit

SMMT Position

The automotive industry has been consistent and united – a ‘no deal’ Brexit would have a devastating impact on the sector and the hundreds of thousands of jobs it supports. It would end frictionless trade, add billions to the cost of importing and exporting and put jobs at risk. We believe that a ‘no-deal’ should be taken off the table for good to end damaging uncertainty that has undermined investor confidence and forced companies to spend millions on ‘no deal’ continguency planning.

Government must secure a future deal with the EU which guarantees frictionless trade and the free movement of goods between the UK and the EU; retains the UK’s preferential trading relationships with third countries such as Japan, Canada, South Korea and Turkey; and maintains the sector’s ability to access EU talent and move employees freely across sites in the UK and EU.

SMMT comment: Europe’s leading automotive representatives warn of catastrophic consequences of a ‘no deal’ Brexit

Mike Hawes, SMMT Chief Executive, said,

European Automotive is deeply integrated and the benefits of free and frictionless trade have helped our sector become one of Europe’s most valuable assets, delivering billions to economies and supporting millions of livelihoods across the EU.

A ‘no deal’ Brexit would have an immediate and devastating impact on the industry, undermining competitiveness and causing irreversible and severe damage. UK and EU negotiators have a responsibility to work together to agree a deal or risk destroying this vital pillar of our economies.

SMMT’s priorities focus on five areas:

  • Single Market – To achieve automotive priorities on tariff-free trade and avoiding non-tariff barriers, government must demonstrate how it intends to secure a future trade agreement with the EU that affords the automotive industry the benefits currently enjoyed as members of the Single Market.
  • Customs – Under a new customs agreement with the EU, government should prioritise the free-flow of automotive goods at the border to avoid costs, maintain competitiveness and support the just-in-time manufacturing process. Key issues include continued application of common customs rules and procedures without burdensome checks or reporting.
  • Talent – Government must address the needs of the automotive industry in its ability to recruit and access talent when assessing how the UK ends freedom of movement and implements new immigration controls. Key issues include access to labour to fill skills gaps and the current ability for automotive companies to quickly and easily move employees to address operational issues or support project teams.
  • Regulation – Government should demonstrate how existing automotive regulation fits within plans for the ‘Repeal Bill’ and work through options for how future EU regulation affecting the UK automotive industry can be effectively implemented. Key issues include future influence on regulations affecting the UK automotive industry, the potential to create non-tariff barriers through regulatory divergence and the ability for the UK to type approve vehicles for the European market.
  • Trade – Clarity is needed on how the UK will treat both existing EU Free Trade Agreements and those currently under negotiation. Key issues include establishing solutions to issues around Rules of Origin, understanding how existing preferential access to markets can be secured as well as benefits from regulatory discussions between the EU and other key markets.

Future Trade Models

SMMT give an assessment of future UK/EU trade models and whether they deliver on the automotive sector’s priorities 

WTO export tariff automotiveWTO import tariff automotive

EU workers in UK automotive manufacturing sector