Car makers across UK and EU urging politicians to secure Brexit trade deal to avoid ‘catastrophic’ losses
Car makers across the UK and the EU are urging politicians to secure a Brexit trade deal to avoid ‘catastrophic’ losses.
Tariffs would threaten the production of 3 million EU- and UK-built cars and vans over the next five years.
This would mean losses of up to £84billion for the European automotive sector, and threaten thousands of jobs.
Warning: Tariffs would threaten the production of 3m EU- and UK-built cars and vans over the next five years
Without a deal in place by 31 December, both sides would be forced to trade under so-called World Trade Organisation (WTO) non-preferential rules, including a 10 per cent tariff on cars and up to 22 per cent on vans and trucks.
Such tariffs – far higher than the small margins of most manufacturers – would almost certainly need to be passed on to consumers, making the average family car around £1,500 more expensive.
The industry has warned that the impact could also likely result in reduced choice and impacting demand.
Furthermore, automotive suppliers and their products will be hit by tariffs. This will make production more expensive or will lead to more imports of parts from other competitive countries.
Speaking for the whole industry, Mike Hawes, of the UK’s Society of Motor Manufacturers and Traders, said: ‘These figures paint a bleak picture of the devastation that would follow a No Deal.
‘The shock of tariffs and other trade barriers would compound the damage already dealt by a global pandemic and recession, putting businesses at risk.’