SMMT boss says automotive sector will suffer if Brexit occurs before ongoing trading relationship is finalised

The Society of Motor Manufacturers & Traders (SMMT) has called on the Government to secure an interim agreement with the European Union (EU) to safeguard the future of the UK motor industry until a final agreement on Brexit is reached.

Formal talks over Britain’s withdrawal from the EU began in Brussels yesterday, and are expected to take up to two years to complete.

SMMT chief executive Mike Hawes said the UK automotive industry accepted that Britain would be leaving the EU, but raised doubts as to whether a final deal on a future relationship could be finalised and implemented by March 2019. 

Hawes called Brexit "the greatest challenge the industry has faced in a generation", and said it was vital an interim agreement be secured by the British government to safeguard the country's motor industry.

"Any Brexit agreement will be hugely complex," said Hawes. "We [the UK] must negotiate with 28 countries, each with their own vested interests, making a March 2019 completion date to negotiations - as indicated by the triggering of Article 50 - feel somewhat ambitious.

"We need to be pragmatic - we are not going to be able to negotiate a plan of the complexity we require in that time and an interim deal would give us stability. We need no tariffs, frictionless trade and no uncertainty, as we have today, if we are to keep growing the industry during this period.

"Uncertainty risks death by a thousand cuts - this is an incredibly competitive global industry, with major investment decisions being made all of the time. If there is any uncertainty it erodes our competitiveness, because the companies making the major investments don't like uncertainty. If we have an interim deal that maintains what we have today then it allows time to negotiate a full deal without the risk of the UK dropping off a cliff edge that could undermine our industry permanently.

"This uncertainty cannot be allowed to drag on and drag down UK business," he said. "We need business as usual from day one - this process will likely take five years or more, not two. We need an arrangement for as long as it takes, otherwise we risk damaging our business permanently."

Hawes did note that, in the long-term, there could be positives to come out of Brexit. He said: "We trade with 160 countries and there could be ways to reduce tariffs with some, for instance, or for small-volume manufacturers to work to new regulatory requirements that improve competitiveness."

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Comments
19

20 June 2017
"We [the UK] must negotiate with 28 countries". I think someone needs a lesson on how the EU works.

 

Hydrogen cars just went POP

20 June 2017
I think what he means is that 28 countries are going to be around the table and each one is going to have a point of view, not 28 individual treaties.

20 June 2017
Rtfazeberdee wrote:

I think what he means is that 28 countries are going to be around the table and each one is going to have a point of view, not 28 individual treaties.

Four x is correct. The first lesson that the SMMT needs to learn is that the UK will only be on one side of the table, hence we shall be negotiating with twenty-seven nations not twenty-eight. More importantly, however, they need to learn that the negotiations matter only with one, because when we agree a deal with Merkel she will tell the rest that that is what they're getting so they'd better get used to it. That is how the EU works.

I don't need to put my name here, it's on the left

 

20 June 2017
27 + 1 = 28 in my calculations. Merkel telling the rest what to do and they follow like sheep is just Farage nonsense to scare you and it looks like it worked.

21 June 2017
Rtfazeberdee wrote:

27 + 1 = 28 in my calculations. Merkel telling the rest what to do and they follow like sheep is just Farage nonsense to scare you and it looks like it worked.

Okay, I see you're short on observation and comprehension so I'll go through the details for you.

Four x accurately repeated the SMMT quote from the story that the UK would be negotiating with twenty-eight other nations, to highlight the inaccuracy of that statement. You then suggested that the statement was correct as there would be twenty-eight nations represented at the table, also referencing the number twenty-eight when you correctly wrote that there would not be individual treaties. You then backed up your assertion that twenty-eight nations around the table is the same thing as the UK negotiating with twenty-eight nations in your reply to my post. However, since the UK will clearly not be negotiating with itself, the SMMT statement and your claims for its veracity are demonstrably flawed. The UK will be negotiating with representatives of twenty-seven countries, not twenty-eight.

Additionally, it doesn't scare me that the Germans give the orders to the rest of the EU, we're out of it and I couldn't give a toss what they do to each other.

I don't need to put my name here, it's on the left

 

20 June 2017
Hmm, it's almost as though those who campaigned to leave the EU hadn't fully considered all the ramifications.


20 June 2017
bomb wrote:

Hmm, it's almost as though those who campaigned to leave the EU hadn't fully considered all the ramifications.

There were always gonna be downsides as well as upsides. We won't sell as much to the EU but the sales are a 2 way thing and considering almost 70% of the sales are from European brands, I can't see us suffering too much in the motor industry.

20 June 2017
but.. but.. but we were told that we can have our cake and eat it and that means no downsides...
seems like SMMT thinks otherwise. the luxury brands from europe will not lose out because they are mainly vanity purchases and a higher price gives the vain more bragging rights on how "good" they think they are. the smaller lower cost brands will lose out as that sector is more price sensitive which could hurt Japanese cars made here being sold on the mainland.

20 June 2017
What bit do you not understand that BMW,GM,Honda,Nissan& Toyota will not risk both the varying exchange rate of the pound and euro combined with import duties from the EU. All apart from Honda have plants in the EU and will switch production there. BMW are well on the way to that with Mini production to Austria & Holland. Jaguar Land Rover are building a plant in Slovakia already as well,so if you can't see the hundreds of thousands of well paid jobs in the car industry being lost as not suffering too much,then to be honest I don't hold out much hope for you

20 June 2017
ianp55 wrote:

What bit do you not understand that BMW,GM,Honda,Nissan& Toyota will not risk both the varying exchange rate of the pound and euro combined with import duties from the EU. All apart from Honda have plants in the EU and will switch production there. BMW are well on the way to that with Mini production to Austria & Holland. Jaguar Land Rover are building a plant in Slovakia already as well,so if you can't see the hundreds of thousands of well paid jobs in the car industry being lost as not suffering too much,then to be honest I don't hold out much hope for you

You write defeatist rubbish. What makes it a good idea to be part of a corrupt and undemocratic EU which threatened us to try to force us to stay as a member and keep paying them, and now promises retribution against us for wanting to have the right to decide our own destiny.

If an individual, who is doing business with another individual, tells that second individual that if they cease their business arrangement they are going to get their house burned down, the police will quite rightly come along and put that first individual away for extortion. That is a protection racket and is that sort of thing is run by gangsters.

Do you really think that those are the kind of people with whom we should be planning the future of our country? Do you think that those are people who have our best interests at heart? Because I don't, and I am very dubious about anybody who does. I think they just wanted us to pay up and shut our mouths, like good little victims.

We have just about bugger all influence in the EU. They take no account whatsoever of our needs or desires. The only way we ever get to do something that we want is by having an opt-out and doing the opposite to what the rest of them are doing. And once the single European state arrives that veto would be taken away promptly.

As to this talk of being fearful of competition from Eastern Europe. If it's that amazing why do so many want to come over here and fear not being able to once we've left? I'm all for selecting people to come here if they have skills of which we can make use, wherever they may come from. But if they are all such wonderful, talented and dedicated workers then surely their own countries should be beating the balls off poor, incapable, needy Britain as lands of opportunity for all. I certainly don't see why we need to leave the doors open for them to come as they please.

I actually believe in this country, I think we will be better off out of the EU and will make Britain great again. I don't believe that we need to be anybody's slave, so that we may hope to get fed just enough to survive. I believe that Britain can be prosperous on its own account and by its own efforts.

But frankly I would consider it a bargain to be out of that cesspit at any price. And I do not wish to retain any form of membership to their little club of gangsters. All the negotiating that needs to be done is to agree to have no trade tariffs either way. We don't need to be in their single market, playing by their corrupt rule-book. We'll buy and sell with them, but we won't share the shop.

You may want to do Britain down, and ramble on about how we can't prosper on our own, but I do not subscribe to that point of view. I believe that we can tell the gangsters that we aren't going to pay their protection money any longer, that we are going to look after ourselves from now on.

We are going back to being Great Britain, and we are going to be just fine.

I don't need to put my name here, it's on the left

 

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