Aston's chief financial officer says a UK failure to reach agreement with EU over type approval could force company to temporarily halt production
James Attwood, digital editor
15 November 2017

Aston Martin faces the ‘semi-catastrophic’ prospect of having to temporarily halt production if the UK government fails to secure a Brexit agreement with the European Union, the firm’s financial boss has told parliament.

Giving evidence to the Business Select Committee, chief financial officer Mark Wilson said potential problems with vehicle certification could significantly affect the company.

Currently, all new cars in the UK must secure Vehicle Certification Agency (VCA) approval, which is valid in the EU. But, if a Brexit deal is not reached, VCA validity for new models in Europe could cease in March 2019. Companies are not allowed to hold simultaneous type approval from two authorities, therefore if UK firms were forced to apply for new vehicle certification that would be valid in Europe, they would have to stop production while doing so.

“For Aston Martin, it’s simpler than for larger international players,” Wilson told the committee. “We’re a British company, we produce our cars exclusively in Britain and will continue to do so. Without VCA type approval, it really is a stark picture for us. We need to make sure that type approval carries over, has validity and recognition, and has the equivalence it has today.

“Otherwise, there are significant costs involved in gaining another type approval, but also the semi-catastrophic effect of having to stop production, because we only produce cars in the UK.”

Wilson added he was “encouraged” that a transitional agreement would be reached that would allow production to continue, but added: “During that transition, we would have to look at how Aston Martins were recertified under a non-VCA structure.”

Car industry in further clarity calls

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, and Patrick Keating, Honda Motor Europe’s government affairs manager, also gave evidence to the committee. Both joined Wilson in calling for clarity over a Brexit transition deal.

Asked whether a lack of clarity over Brexit could impact investment in the motor industry, Hawes said: “Companies don’t just make an investment at one particular point, there’s constant investment. Some investments are overdue, and some are waiting as long as possible for clarity.

“Looking at the timetable for leaving the EU, the general view is that companies need more certainty by the turn of the year, because contingency arrangements will have to be put in place to give you a good 12 months before you start.”

Opinion: UK car manufacturing success can't overshadow Brexit challenges

Calling for clarity by March 2018, Keating said that it would take 18 months for Honda to get its systems ready for potential new customs procedures for exporting to Europe. Noting that Honda imported two million components from Europe each day, he estimated a 15-minute delay at customs would cost the firm £850,000 a year, because the company carries just one hour of stock on its shelves.

He added: “We’re thinking about increasing the amount of warehousing and the amount of stock we would have to hold if friction entered the border.”

Read more

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UK car success under threat from Brexit, according to industry

Opinion: UK car manufacturing success can't overshadow Brexit challenges

Nissan and Toyota back UK despite EU single market announcement

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Comments
23

15 November 2017

Hope there’s a clause in your contract with your German engine supplier for that eventuality!

 

Hydrogen cars just went POP

15 November 2017

‘semi-catastrophic’ anyway? Is it a way of using the word 'catastrophic' in a sentence for dramatic effect without actualy saying it will be catastrophic.

 

Hydrogen cars just went POP

15 November 2017

With the effects we've already had, currency dropping, cost of living going up, and potentially even just the lightest of barriers going up (eg VAT - try buying goods from Norway or Switzerland and you'll understand), what is the good of Brexit?

 

We're shooting ourselves in both feet just to please the bigots and racsist within our country.   Remove them and you get a different result.

 

It's the ordinary person who's ending up worse off.

 

15 November 2017
Symanski wrote:

With the effects we've already had, currency dropping, cost of living going up, and potentially even just the lightest of barriers going up (eg VAT - try buying goods from Norway or Switzerland and you'll understand), what is the good of Brexit?

 

We're shooting ourselves in both feet just to please the bigots and racsist within our country.   Remove them and you get a different result.

 

It's the ordinary person who's ending up worse off.

 

I wouldn't use Norway or Switzerland as examples to prove a point as they're rated as one of the highest if not the best place to live and bring up a family!

 

Hydrogen cars just went POP

15 November 2017
xxxx wrote:

Symanski wrote:

With the effects we've already had, currency dropping, cost of living going up, and potentially even just the lightest of barriers going up (eg VAT - try buying goods from Norway or Switzerland and you'll understand), what is the good of Brexit?

 

We're shooting ourselves in both feet just to please the bigots and racsist within our country.   Remove them and you get a different result.

 

It's the ordinary person who's ending up worse off.

 

I wouldn't use Norway or Switzerland as examples to prove a point as they're rated as one of the highest if not the best place to live and bring up a family!

 

Both Norway and Switzerland pay to access the single market and accept the four freedoms. Britain has a problem with both of those criteria.

15 November 2017
aatbloke wrote:

xxxx wrote:

I wouldn't use Norway or Switzerland as examples to prove a point as they're rated as one of the highest if not the best place to live and bring up a family!

 

Both Norway and Switzerland pay to access the single market and accept the four freedoms. Britain has a problem with both of those criteria.

 

I bought goods from Switzerland and ended up paying duty and VAT.   From a country that's supposed to be a trading partner!   So that sinks the "free trade" agreements.

 

Norway I've got to put on customs slip whenever I sell my products to them.   Same with Switzerland.   So that's a barrier to those countries buying from the UK.

 

Both of course are expensive to live in.   I used them as examples of countries which have a close tie with the EU, but there's still barriers.   You're right that you can't compare really, the likes of Norway rightly kept their fishing to themselves (second biggest exporter in the world of fish I believe).   Not sure about Switzerland's industry.   Biggest exporter of cuckoo clocks?

 

But what can't be denied is the effect Brexit has already had on the UK, and pretty much all of it negative.

 

16 November 2017
Symanski wrote:

aatbloke wrote:

xxxx wrote:

I wouldn't use Norway or Switzerland as examples to prove a point as they're rated as one of the highest if not the best place to live and bring up a family!

 

Both Norway and Switzerland pay to access the single market and accept the four freedoms. Britain has a problem with both of those criteria.

 

I bought goods from Switzerland and ended up paying duty and VAT.   From a country that's supposed to be a trading partner!   So that sinks the "free trade" agreements.

 

Norway I've got to put on customs slip whenever I sell my products to them.   Same with Switzerland.   So that's a barrier to those countries buying from the UK.

 

Both of course are expensive to live in.   I used them as examples of countries which have a close tie with the EU, but there's still barriers.   You're right that you can't compare really, the likes of Norway rightly kept their fishing to themselves (second biggest exporter in the world of fish I believe).   Not sure about Switzerland's industry.   Biggest exporter of cuckoo clocks?

 

But what can't be denied is the effect Brexit has already had on the UK, and pretty much all of it negative.

 

VAT is an EU tax, and neither Norway or Switzerland are part of the EU. Therefore you'll be charged import duty and EU VAT at the previailing rate of the member state you're in.

The single market and customs union ensures that trade is seemless with minimal disruption to the flow of goods moving between member states.  This is crucial for corporations operating on tight margins, such as car manufacturers for instance.

 

 

15 November 2017

Nothing to see here.  Everything is going spiffling well with Brexit.

Isn't this the most monstrously ironic thing about Brexit, that it is down to the hard working remainers to sort the mess out.

15 November 2017
oaffie wrote:

Isn't this the most monstrously ironic thing about Brexit, that it is down to the hard working remainers to sort the mess out.

Yawn

15 November 2017

Surely something is either catastrophic or it isn't? I wasn't aware that there were grades of catastrophy.

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