AM Online

Brexit and political wrangles have "wasted millions" in UK automotive industry

SMMT chief executive, Mike Hawes

UK vehicle manufacturers face a likely £3.2 billion annual increase in costs from WTO tariffs on imported parts and exported vehicles if the UK leaves the European Union without a “world-beating” trade deal, says the SMMT.

And it predicts a drop in vehicle production by 1m units by 2024 if there is no deal.

It has urged all political parties to put the UK’s automotive sector at the heart of their economic and trade policies.

“UK Automotive’s needs are clear: frictionless trade free of tariffs, with regulatory alignment and continued access to talent,” said SMMT chief executive Mike Hawes.

“Rather than producing two million cars a year by 2020, a no trade deal, WTO tariff worst case scenario could see us making just a million. The next government must deliver the ambition, the competitive business environment and the commitment needed to keep automotive in Britain.”

George Gillespie, SMMT president, said the industry has spent millions on ‘no deal’ preparation – not once, not twice, but three times.

He said it was “wasted millions” that should have been spent on research and development.

“We have in the past invested our resources not only in our technology and facilities but also in our people. In skills to fulfil our ambitions.

“But look at what uncertainty is doing to investment. Before the referendum it averaged £2.5 billion per year.

“Until recent new announcements, that figure had fallen from £2.5 billion to a paltry £90 million in the first half of this year.

“£90 million across every UK manufacturer is barely enough to keep our existing plants operational.

“That could be a predictor of our manufacturing sector’s fate in 3 to 5 years,” said Gillespie.

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  • wenzela99 - 27/11/2019 13:05

    Yawn - what a load of rubbish - when is the industry going to wake up? Clearly a deal is the best option but having spent over 30 years in the industry the fact is that it always finds a way to resolve matters no matter what so as usual a great deal of scare mongering going on because the industry hates change and is very slow in accepting it's inevitability but in the end joins the party kicking and screaming. I can understand that because change is quite often difficult and can be disruptive and who would want that! It is quite amusing reading what new things and ideas manufacturers are always planning to introduce particularly at the retail level - the truth is that very little has changed in this respect apart from on the surface with some of the prestige brands and as far as the rest are concerned they are still living in the dark ages when it comes to the basics like customer engagement, qualification, follow up and retention - same old same old as the business that manufacturers say that they are desperate for is wasted with poor quality and poor customer satisfaction at the retail end. As far as Brexit is concerned I personally voted to remain but as soon as the result came in I accepted that leave won as this is democracy. It is unfortunate that the industry did not do the same and has instead continuously supported the remain lobby who have used every trick in the book to frustrate the leave process so please stop bleating about reduced production forecasts and using Brexit as an excuse for it's lack of vision and forward planning. If electric cars are the future then that is the nut to crack at the production end and what the industry needs to get a grip of instead of using Brexit as the excuse for reduced productivity of technology that now has a limited life span!