UK automotive industry pleads against ‘no-deal’ Brexit
A body representing the UK’s car industry has issued a plea to the next Prime Minister not to lead the country out of the European Union (EU) without a deal.
In a report, the Society of Motor Manufacturers and Traders (SMMT) highlighted the £101bn in trade generated by the sector annually, but said that a hard border with the EU could potentially cost the automotive sector £50,000 a minute, or £70m a day, in a worst-case scenario.
It said a no-deal scenario would trigger a “seismic shift” in trading conditions that would see tariffs being piled on to exports which would deliver “a knockout blow to the sector’s competitiveness”.
Boris Johnson, the frontrunner to succeed Theresa May, and his leadership rival Jeremy Hunt have both said they are prepared to take Britain out of the EU without a deal, although both also say it is not their preferred option.
Mike Hawes, chief executive of the SMMT said the impact of Brexit was already being felt: “We are already seeing the consequences of uncertainty, the fear of no deal.
“The next PM’s first job in office must be to secure a deal that maintains frictionless trade, because for our industry ‘no deal’ is not an option [and] we don’t have the luxury of time.”
Indeed, UK car production fell by 18.2 per cent year-on-year this January, a six-year low - figures that were blamed on falling confidence due to the political turmoil around Brexit.
A disorderly exit could see tariffs of up to 10 per cent being imposed on finished models and border charges.
So far this year, Britain’s biggest carmaker Jaguar Land Rover has announced 4,500 jobs cuts; Honda said it will close its car factory in Swindon after decades in the town, and Ford will shut one of its two engine plants.
The SMMT said that automotive is the UK’s single biggest exporter of goods, trading with some 160 countries worldwide and accounting for more than 14 per cent of total exports. It added that the sector is one of the country’s most valuable economic assets, directly employing 168,000 people.
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