The UK’s car industry will be put at risk if World Trade Organisation rules are put in place following a no-deal Brexit, industry groups across Europe have warned.
The European Automobile Manufacturers Association (ACEA) and the European Association of Automotive Suppliers (CLEPA) warned that 10 percent tariffs will apply to cars and 22 percent on vans and trucks.
A reduction in demand resulting from a 10 percent WTO tariff would be likely to reduce EU and UK factory output by three million cars and vans over the next five years, with losses of 52.8 billion euros to UK plants.
The European car industry has already been hit by the coronavirus pandemic. Fifteen weeks remain of the Brexit transition period, and unless a deal is found the new tariffs will apply from January 1, 2021.
A particular cause for concern for UK-based car manufacturers is their reliance on ‘just in time’ car parts imported from mainland Europe.
PHOTO: German car workers Reuters