Society of Motor Manufacturers and Traders president calls for quick action to secure tariff-free deal
Sam Sheehan
28 November 2017

The negative effects of Brexit are already being felt and emphasise the need for faster-paced government negotiations, Society of Motor Manufacturers president Tony Walker has said.

During his speech at the 101st annual SMMT dinner, Walker said Britain’s car industry requires hard answers and certainty from the government, in order to prevent trends of falling consumer confidence and slowing car sales from reaching a critical point.

“We [the industry] will never stop striving to be competitive,” he said, “but we ask government to help provide the conditions in which we can compete. Like every industry, we need certainty now.”

Brexit has been directly linked to falling domestic demand for new cars, which decreased by 2.9% in October alone and has seen predictions for the nation’s car production output fall by 700,000 units for 2017 to 1.73 million. Exports of British-built cars, by comparison, grew by 5% last month, ensuring that the nation’s overall output actually grew by 3.5% across the four months.

Walker revealed that 1100 lorries supply parts from Europe to the car industry per day, with the majority arriving without any customs checks. HM Revenue and Customs figures show that these contribute £35 million worth of components to car plants a day, with almost 80% of the cars they help to make being exported – most to Europe.

These close ties with Europe for supply and export, Walker explained, emphasise the importance of securing a tariff-free deal with the continent. If no deal is made, Britain’s departure from the European Union on 29 March 2019 could leave the industry faced with at least £4.5 billion of World Trade Organisation tariffs per year.

“We have delivered an export-led renaissance,” said Walker. “But we are not complacent. A hard Brexit would undermine all that we have collectively achieved. It is a real threat – a hurdle we cannot ignore.”

Alongside his calls for quicker negotiations, Walker also asked the government to understand the importance for continued development of combustion engines in order to up the rate of progress in green technology. In response to the UK’s recent announcement of a ban on pure petrol and diesel cars from 2040, he said “the internal combustion engine is not dead – it is the path to a cleaner and greener future.

“Banning diesel and petrol cars might be a sound bite that works but it’s not a policy that works. If you ban them you disrupt the new car market and you hamper investment in the electric, emission-free vehicles of tomorrow. You set the future back.”

SMMT CEO Mike Hawes took things further in his speech, proclaiming that the government's movements could be catastrophic. He said: "UK Automotive is great at technology. And we are damn good at internal combustion engines in particular – just look at Formula One for proof.  Yet we seem to be hell bent on destroying that reputation.

"We tell the world we want to ban petrol and diesel cars by 2040. We introduce taxes, charges and budget measures which ignore technological development, which undermine our industrial capability and which demonise one technology, diesel, despite the benefits it delivers consumers. Customers are not moving straight from diesel to electric. They're moving to petrol or staying put in their older cars. So we're seeing a falling market, declining revenues, rising costs, rising CO2. This is not a policy without consequences."

Hawes said that the UK Government needs "a dose of reality". He said "the industry is agile, it can adapt. But it needs certainty, sensible timescales and supportive conditions".

Chancellor Phillip Hammond’s recent diesel tax is the latest in a line of government moves that have concerned the automotive industry. Hammond revealed that a tax hike will be applied to new diesel cars that don’t conform to next-generation emissions testing standards, which themselves won’t come into force until 2020.

SMMT CEO Mike Hawes stated that the new law, which has been introduced to reduce the number of diesel vehicles on Britain’s roads, would hinder “the ability of the industry and government to achieve CO2 limits”. He said that targeting the newest and lowest polluting models wasn’t the most effective way of reducing the ever-growing air quality problem.

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Comments
8

29 November 2017

The Leave told us it would be a wonderful thing Brexit, but have we seen anything that will make the UK a better place?   Anything?

 

Farage admitted it was all sold on pack of lies.   Those lies now means we've had inflation rising, and that doesn't include "shrinkage" of products (strange, but official figures for inflation don't take in to account if a pack get smaller, only if the price rises).

 

PM May is hiding the reports setting out the impact of Brexit.   If these were advantagous to us, the ordinary person, they'd be shouting from the rafters how wonderful Brexit would be.   What we're getting, instead, is censored reports that even MPs aren't allowed to see.

 

Let's not gloss over that the "Leave" vote was only marginally larger.  1% swing and it would be a "Remain" result.   And if you took the vote today, that's exactly what you'd get - a Remain result.   Because peolpe are now starting to realise the negative effects on their cost of living.

 

At which point does PM May say that Brexit is causing too much hardship for the people of the UK?   At which point do our politicians start being honest with the electorate?

 

29 November 2017

You don't like British freedom or British democracy do you?!

29 November 2017
Symanski wrote:

At which point do our politicians start being honest with the electorate?

You'll be waiting a very long time.

29 November 2017

Lower unemployment, controlled population, higher wages, lower house prices, no EU gravy train for the German and French politicians.

At which point will the remoaner haters out there that are full of contempt realise the lies  about a European War or famine won't happen and learn to value other people opinions, often less fortunate than the remainers, count!

 

Hydrogen cars just went POP

29 November 2017
xxxx wrote:

Lower unemployment, controlled population, higher wages, lower house prices, no EU gravy train for the German and French politicians.

 

Job are heading over to Europe.   Population isn't under control as no deal has been set.   Higher wages, but not even close to keeping up with inflation - you're still losing out.   No sign of lower house prices, they're still increasing.   France and Germany still in the EU, nothing has changed there.

 

So in other words the same fantasies that Farage et al have been selling for years with absolutely no substance behind the claims.   Brexit on a pack of lies.

 

Reality?   Higher cost of living, and more expensive imports or foreign holiday because the currency collapsed.   That's the undeniable truth.

29 November 2017

Dragging up the vote over and over is so dull. Its done. More important now is that the UK government is about to sell out the entire nation by hideously bribing the EU for its permission to sell US overpriced dodgy VW's. A poll by even the EU loving Guardian showed 71% of the population forbid the government paying this. Theresa May is going to do it anyway. Its not Brexit damaging us, its the Remain influences stopping us standing strong and getting walked on by appeasement. Well done 'Remain' you cut our nose off to spite your face, I hope engineering that 'told you so' was worth the cost.

29 November 2017

A proper BREXIT will mean that a tariff-free trade deal will probably not be done with the EU. There won't be an EU after the UK has left anyway.

Car manufacturers should get ready for tariffs to be implemented. 23rd June 2016 to March 2019 is the transition period.

It will take a new BREXIT government to ensure that the UK leaves the EU properly.

19 December 2017

A few points here:

1. So output is up 3.5% and exports grew by 5%. Sounds awful!

2. The government's new industrial strategy intends to increase the percentage of components produced domestically, reducing our reliance on these imported components.

3. The uncertainty surrounding Brexit is the result of a government that, rather than just getting on with leaving, is hell bent on anchoring us to Europe against our will.

4. The Cost of Living has done more to damage competitiveness than Brexit possibly could. Indeed, reducing the supply-demand imbalance in housing, as well as dropping tariffs on imported food, clothing and footwear are just some of the great opportunities presented by Brexit that will help to make all of our domestic industry more competitive.

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