Car industry launches plan to mitigate “devastating” impact of hard Brexit


Hugo Griffiths

2018-10-10 07:40

SMMT announces ‘Brexit Readiness Programme’, offering support to industry for the “planning minefield” posed by a hard Brexit

MINI Plant Oxford - engine line

Britain’s automotive sector is preparing for a no-deal Brexit by launching a new Readiness Programme, and setting up a free Brexit telephone helpline for businesses involved in the industry. 

The Society of Motor Manufacturers and Traders (SMMT) is primarily targeting small and medium-sized enterprises (SMEs) with the initiative, saying 69 per cent of companies involved in UK automotive supply chain employ fewer than 10 people. The SMMT considers such firms may not have the resources to adequately prepare for a hard Brexit, and its assistance programme will see big outfits like Deloitte and PwC offer advice and consultancy services.

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The first phase of the programme will also help businesses plan for post-Brexit trade and tax arrangements, regulation changes related to chemicals, data protection, immigration rules and employment law.

Other difficulties potentially being faced by the Industry include calculating the value of goods for the purposes of trade tariffs, proving the country of origin of items made in the UK, and planning linked to the stockpiling parts; this latter issue may be made necessary by border bottlenecks and other import/export difficulties.

The frictionless trade European trade conferred upon the UK by its EU membership means such considerations have hitherto been unnecessary, but Brexit – and particularly a hard, no-deal Brexit – could force firms to rethink their trade arrangements.

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The SMMT highlighted the Midlands as an area particularly at risk from the impacts of Brexit. Some 39 per cent of automotive jobs are in the area, while one in 11 UK-made cars is built in the city of Derby alone.

Commenting on the programme, Mike Hawes, chief executive of the SMMT, said local supply chains form the “backbone” of manufacturing, and the UK car industry had “thrived” thanks to the frictionless trade made possible by EU membership. 

• Brexit offers “no advantages” for UK carmakers

Hawes added a no-deal Brexit could have “devastating” consequences for the industry, and that the SMMT’s new initiative “seeks to mitigate the threat of ‘no-deal’ by helping businesses navigate the complex trade realities of a post-Brexit landscape.”

Will a hard Brexit be as devistating for the car industry in the UK as the SMMT believes? Let us know your thoughts in the comments…

 

Source: – autoexpress
Car industry launches plan to mitigate “devastating” impact of hard Brexit