SMMT calls for ambitious BREXIT deal to protect automotive industry in the build up to the election

by Dec 4, 2019Blog, News

The Society of Motor Manufacturers and Traders (SMMT) last week released a statement in the wake of the imminent election calling for all parties to ensure that UK Automotive was a big part of their economic and trade policies.

The organisation made it clear that whoever is in charge, the new government must take great care to ensure that the multi-billion pound industry was protected into the future. The SMMT has called for an ambitious Brexit trade deal, which would help to maintain the sector’s competitiveness and ability to deliver ‘innovation, productivity, and prosperity for Britain’.

We want to work closely with the next government, as we have in the past; united in a common purpose to keep UK Automotive a global player that drives employment, creates wealth and gives all of us pride in what we can do here.

– George Gillespie, SMMT President

George Gillespie, the SMMT President, spoke at the 103rd SMMT Annual Dinner in London last week saying: “The automotive sector is going through a period of unprecedented change and we must not let the pressure of Brexit deflect from our focus on a coherent national industrial strategy.

“Collaboration between industry and government must be stronger than ever… We want to work closely with the next government, as we have in the past; united in a common purpose to keep UK Automotive a global player that drives employment, creates wealth and gives all of us pride in what we can do here.”

This statement came after the SMMT showed how a bad Brexit deal could drastically affect the industry. Independent research, commissioned by the trade body, revealed that WTO tariffs on imported components and exported vehicles would add more than £3.2 billion a year to UK automotive manufacturing costs.

This is a dramatic increase, which is the equivalent of almost 90% of the sector’s annual R&D spend. The industry would, according to the SMMT, not be able to absorb this amount, which may lead to price rises and shrinking global demand. This would be particularly detrimental to the industry at a time when additional investment in safer, cleaner and more intelligent mobility technology is essential.

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.

– Mike Hawes, SMMT Chief Executive

The last 10 years has seen the UK Automotive industry grow dramatically. The SMMT has put this down to massive investment and collaboration with governments through a detailed comprehensive strategy.

However, the future uncertainty surrounding Britain’s exit from the European Union, has led many to fear for the industry’s future.

The SMMT Chief Executive, Mike Hawes, said: “UK Automotive’s needs are clear: frictionless trade free of tariffs, with regulatory alignment and continued access to talent. Detailed trade negotiations have yet to begin. They will be complex and they will take time. But a close trading relationship is essential to unlock investment so we can deliver our goals: cleaner air, zero carbon emissions, and the ability to go on building our products and marketing them globally.

“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.”

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