‘Hundreds of thousands’ of automotive jobs at risk from no-deal Brexit

No deal over Brexit could put hundreds of thousands of jobs at risk in the UK automotive industry, MPs have warned.

The Business, Energy and Industrial Strategy (BEIS) Committee said the Government had to keep the closest possible relationship with the existing EU regulatory and trading framework in order to give UK car manufacturers a realistic chance of survival post-Brexit.

In its ‘The impact of Brexit on the automotive sector’ report, the BEIS Committee said no-deal would put hundreds of thousands of UK jobs at risk and threaten hundreds of millions of pounds of inward investment.

It cites claims by The Society of Motor Manufacturers and Traders (SMMT) that the introduction of trade barriers would result in a £4.5bn drop in vehicle exports.

Ironically, the report was published on the day Toyota committed production of the new Auris – and its engines – to the UK.

The report finds that non-tariff barriers, in the form of border delays and increased bureaucracy, will also impact on UK competitiveness.

It recommends the Government places a high premium in its Brexit negotiations on securing frictionless trade for the automotive sector.

Rachel Reeves, chair of the Business, Energy and Industrial Strategy (BEIS) Committee, said: “The car industry is one of the UK’s great manufacturing successes. Innovative and efficient car plants across the country provide thousands of jobs and the automotive sector is a major contributor to our economic growth.

“There is no credible argument to suggest there are advantages to be gained from Brexit for the UK car industry.

“Regulatory consistency and friction-free trade benefits car companies, consumers and car-workers. The Prime Minister now needs to ensure common-sense pragmatism prevails and spell out the Government’s intention to seek continued regulatory and trading alignment with the EU in the automotive sector.”

Unite, Britain’s largest union, has echoed the conclusions of the report.

It said the committee’s findings were in line with Unite’s own research, which concluded that a ‘no deal’ Brexit would put hundreds of thousands of UK jobs at risk and threaten inward investment.

Unite assistant general secretary for manufacturing Tony Burke said: “This report is a welcome acknowledgment of Unite’s long-held position that a ‘hard’ Brexit would be a mortal blow for the UK’s automotive industry.

“It is absolutely essential for the well-being of the car industry that the UK retains tariff free access after it leaves the European Union. The only sensible way of achieving this is for the government to negotiate a customs union.

“The car industry would be hugely affected by a ‘hard’ Brexit but there should not be a specific deal just for this sector. It is essential that all the UK’s manufacturing base is protected by future barrier free access.

“It is also essential to protect the UK’s car industry that regulatory alignment remains as close to that as the EU as possible.”