The main political parties are being urged to ‘put UK automotive at the heart of their economic and trade policies’.
Only a ‘world-beating Brexit trade deal’ would maintain productivity and prosperity for Britain, the Society of Motor Manufacturers and Traders (SMMT) has warned.
Without an ‘ambitious’ trade deal, UK manufacturing would lose 1.5 million vehicles by 2024, costing the country as much as £42.7 billion.
New SMMT research shows World Trade Organisation (WTO) tariffs on imported components and exported vehicles would add £3.2 billion a year to the cost of UK automotive manufacturing.
That’s the equivalent to 90 percent of the sector’s annual spend on research and development.
WTO deal is ‘worst case scenario’
Mike Hawes, SMMT chief executive, 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.”
The SMMT says that the UK is well placed to take advantage of the drive to deliver greener vehicles and intelligent mobility, but warns that a bad deal would threaten further investment.
“This would be a tragic waste,” it says.
Speaking at the SMMT dinner in London, SMMT president George Gillespie, said: “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.”
The UK’s main political parties are gearing up for the general election on the 12 December 2019. This is ahead of the proposed Brexit date of 31 January 2020.