North West set for £389m boost from proposed UK-US Free Trade Agreement

The UK has today (March 2) published its negotiating objectives for a free trade agreement with the United States, with talks expected to begin this month.

A number of North West businesses have already come out in support of an FTA, saying it would help them to trade more easily.

The agreement is part of the Government’s wider vision to level up economic growth across the whole United Kingdom.

The negotiating objectives published today set out that any future agreement must protect the NHS and uphold the UK’s high standards on food safety and animal welfare.

The agreement will also include a chapter on digital trade, to maximise opportunities for businesses to trade digitally across the Atlantic.

Government analysis also published today shows that the North West’s economy is expected to grow by up to £389m as a result of a future UK-US free trade agreement.

The US is the North West’s largest export market, accounting for 13% of all the North West’s goods exports – 3,049 businesses in the North West collectively export £6,831-worth of goods to the US every minute.

The Prime Minister, Boris Johnson said: “We have the best negotiators in the business and, of course, we’re going to drive a hard bargain to boost British industry.

“Trading Scottish smoked salmon for Stetson hats, we will deliver lower prices and more choice for our shoppers.

“Most importantly, this transatlantic trade deal will reflect the unique closeness of our two great nations.”

International Trade Secretary Liz Truss said: “Striking ambitious free trade agreements with our partners around the world is one of the key opportunities of Britain becoming an independent trading nation once again.

“This deal with our biggest single trading partner will cut red tape for our small businesses, cut tariffs for our great products from dairy to cars, and increase growth in all four nations.”

A number of businesses based in North West are set to benefit from increased trade with the US.

Liverpool based supercar manufacturer the Briggs Automotive Company (BAC) has experienced growing demand from the US following support from the Department for International Trade (DIT).

The company manufactures the world’s only road-legal, single-seat supercar – the BAC Mono – and launched a higher-powered, lighter, next-generation model – the BAC Mono R – in July 2019.

Last year the company signed two new dealership agreements with Manhattan Motorcars in New York and Tactical Fleet in Dallas.

Despite some state-level barriers to entry, demand from the US is on the rise, having grown from 19% of BAC’s exports in 2018 to 25% in 2019.

Further export growth is expected this year. This is reflected in plans to grow the company’s headcount from 24 to 30 in the next two years.

The North West is a major hub for car manufacturing, with 19% of all road vehicles exported from the region heading to the US.

Road vehicle exports from the North West to the US totalled £1.1bn in the year to September 2019, an increase of 19.5% on the previous 12 months.

Neill Briggs, co-founder of the Briggs Automotive Company, said: “BAC is forever looking to break new ground and reach new territories across the States. Dealership agreements are already in place in New York and Dallas, with plans to expand into Miami and Los Angeles in line with our target demographic.

Neill Briggs, left, with John Mahon, director general for exports at DIT

“We would certainly welcome a free trade agreement with the US, helping us to continue taking the Mono to the world.”

Manchester-based EDM Aviation, which manufactures aviation industry training equipment, has seen strong export growth in the US over the past five years, and sales in the country now account for 28% of its exports.

It has developed strong relationships in US civil and defence markets and is now looking to establish a support office in the US to grow its exports even further.

With more than 150 employees in the North West, export growth in the US is bringing tangible benefits to the Manchester economy.

Mick Bonney, director, sales and business development at EDM Aviation, said: “The US export market has been integral to the success of EDM over recent years, having secured large contracts to supply training equipment to the military and commercial aviation sectors in the US.

“On average, 50 staff have been employed solely on US contracts over the past 10 years and we continue to expand our footprint in the region having recently secured new business with major US airlines.

“In an effort to support our rapidly-expanding US customer base, we are actively seeking to establish a US support office, which will employ up to five US nationals in the Atlanta Georgia area and offer an unrivalled support network within the industry.”

Manchester-based MPM Products, manufactures high quality pet food for cats and dogs and launched in the US in 2012 and saw sales of $500,000 in its first two years. It’s now expecting $19.5m of US sales in the 2020 financial year, with further growth targeted in e-commerce sales through Amazon.

The company has grown its US presence, and now has three full-time employees in the US and a further 17 staff across five partner agencies.

Chief executive Julian Bambridge said: “The US continues to be a big growth engine for MPM. We have grown exponentially over the last five years and have major expansion plans to move into the US mass grocery market over the coming years.”

Warrington-based ICC Solutions, which provides testing certification services for the payment industry, sees 57% of its turnover generated in the US, and its team more than doubled in size in the 18 months after entering the US market.

From its centre of excellence in Cheshire, ICC Solutions serves clients in more than 100 countries, with the US market central to its operations.

The major catalyst for its growth in the US was in 2014, when it launched a highly-innovative solution to enable the most efficient testing of secure payments such as Chip & PIN, contactless and mobile phone payments.

As a result, over a three-year period US sales increased by more than 500%, and this was recognised with a Queen’s Award for Enterprise.

Chief executive David Maisey said: “ICC Solutions is truly committed to strategic growth in trading with the US, which is by far our largest export market since 2014, accounting for around 60% of overall turnover.

“We have developed important relationships with major organisations and have been recognised as providing quality solutions and services, clearly establishing an excellent reputation.

Director, Wendy Maisey, added: “A free trade agreement will undoubtedly help in our quest to seize the significant opportunities presented by our imminent new US contract at an incredibly exciting time for our company.”

Haverthwaite-based Playdale Playgrounds has targeted US export expansion over the past five years, with 100% year-on-year growth achieved during this period. Despite stiff competition from US rivals, the country is now Playdale’s second largest export market behind Australia.

The company employs 100 members of staff at its two sites in Cumbria, and is targeting further expansion in the US market over the next five to 10 years.

Managing director, Barry Leahey, said: “The US has quickly become a pivotal part of our future global growth plans.

“We would welcome an FTA allowing us to continue our growth into a market that takes the education and growth of the child seriously, and allows us to showcase why we are global leaders in putting smiles on children’s faces through our dynamic equipment.”

Cisco is one example of a US company investing in the North West, with a base in Manchester.

In the UK it has an ecosystem of more than 4,000 IT companies which collectively employ in excess of 20,000 people to support the digital transformation of organisations in all sectors.

The company has invested $1.6bn in technology innovation partnerships with industry, government and academia to help address some of the UK’s more prominent challenges.

In Manchester, Cisco has entered into a number of local partnerships to support innovation in the region, from the opening of Mi-IDEA, its co-innovation centre in partnership with Manchester Science Partnerships, to its lead role in the UK’s largest smart city demonstrator, CityVerve.

David Meads, chief executive, Cisco UK & Ireland, said: “The UK has a strong heritage of technology innovation and partnership.

“In the next three years 93% of the population will be internet users, across all parts of the nation and in every industry.

“That connectivity is already helping organisations in the UK to transform and lead global industry, yet we’re only just at the beginning of what’s possible.

“Cisco has been helping to underpin connectivity in the UK for over 30 years. We see that technology has no limitations in the opportunity it presents, and with a strong US trade agreement in place, will continue to support business ambition in all corners of the nation.”