The news that British businesses could be given a 21-month transition period after the nation’s exit from the European Union has been greeted positively by the Society of Motor Manufacturers & Traders (SMMT).
The Government's proposed deal, outlined on 14 November, would allow UK-based concerns to continue to operate as normal until the end of 2021, when any new international trading regulations would come into effect.
SMMT CEO Mike Hawes said: “For the automotive industry, Brexit is about damage limitation. The outline agreement is a positive step in avoiding the devastating consequences of no-deal and securing a transition period”.
With 80% of cars produced in Britain going to export, manufacturers are concerned that the addition of customs and security processes at ports could slow production and shipping and raise distribution costs.
The temporary maintenance of existing agreements would allow manufacturers to sell more cars and strengthen their market position in the run-up to Britain’s departure from the EU's customs union.
Lack of confirmation, however, remains a problem for UK manufacturers, which, said Hawes, are seeking “certainty and ambition when it comes to securing a competitive future”.
Aston Martin CEO Andy Palmer is equally concerned that plans for a grace period might not come to fruition, stating: “I don’t know whether we have more clarity or less clarity”. However, he is relieved that “at least we have some sort of plan on the table”.
As reported by Autocar on 14 November, Britain’s car makers are finalising plans for the eventuality that no deal between the EU and UK is reached.
