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NFDA Brexit white paper: disruption, but a chance to improve franchised dealers' defences

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The UK’s exit from the European Union must not harm the abilities of the motor retail industry to trade competitively, warns the National Franchised Dealers Association.

Yet it could create the opportunity to negotiate legislation or an industry code of practice that secures investment protection and compensation for franchised retailers during a period of increasing disruptive risks from Brexit and new sales channels.

The NFDA has published a joint white paper with the ICDP, analysing challenges, outlining priorities and investigating opportunities that are likely to appear for the sector as the post Brexit situation emerges. 

The paper, ‘Life after Brexit: challenges and opportunities for UK automotive retail’ discusses the needs for maintaining customer demand with competitive finance and products and for avoiding disruption to vehicle supply and increased costs.

Within it, an NFDA wish list states that if the UK Government is set on leaving the Single Market, a bilateral free trade agreement or sector specific free trade agreement “must be reached”.

“Retailers abilities to continue to grow and develop their businesses in both size and retail strategy should not be hindered.

“Government must not surrender what is arguable a world-leading position – just at a point when international opportunities beckon,” the paper added.

Steve Young, ICDP managing director, said: “Future trading relationship between the UK and the EU should not negatively affect the competitive conditions that auto retailers currently operate in. A zero-tariff agreement, a stable currency and continued availability of affordable finance are key elements to ensure the retail automotive sector remains strong and stable, and continues to thrive post Brexit.”

NFDA director Sue Robinson added: “Assessing the implications of Brexit remains very difficult, but while uncertainty and changes ahead will present challenges, there are potential opportunities for the retail automotive sector, which is resilient and capable of adapting and coping with unexpected situations.

“The UK retail motor industry is one of the major contributors to the UK economy, the strength and success of the sector must not be undermined by uncertainty in the forthcoming months as negotiations develop and Brexit implications unfold.

“We urge the Government to continue to listen to the franchised auto retailers’ voice.”

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