Cars imported from EU could cost £1,500 more if UK leaves single market, SMMT says
List price of cars imported to the UK from other parts of the continent could increase if the UK leaves the single market, Gareth Jones, president of the Society of Motor Manufacturers and Traders (SMMT), warned on Tuesday, 29 November.
He said the increase would be amid import tariffs. The list prices could increase by an average of £1,500 ($1,873) if car makers and their retail networks fail to absorb these tariffs, he added.
Speaking at the society’s 100th annual dinner that was attended by both industry leaders and government officials, Jones urged the UK government to develop its industrial strategy with successful sectors and to focus on the automotive sector immediately post-Brexit. He also called on the government to “make the right decisions” and stay in the single market.
He warned that a failure to do so could see the country’s auto industry face a £4.5bn car tariff threat. The society’s analysis suggests that tariffs imposed by the EU on cars alone post-Brexit could be at least £2.7bn annually to imports and £1.8bn to exports.
Jones’s warning comes just days after the trade association reported that October marked the 15th consecutive month of growth for cars being built for exports. However, Jones said this success was amid multi-billion pound investment decisions taken many years before the EU referendum was even a prospect. While the UK auto industry’s fundamental strengths could face challenges, success should not be taken for granted, he added.
“The challenge now is to make a success of the new future. We want a strong UK economy and we want to see the UK’s influence in the world enhanced. But this cannot be at the expense of jobs, growth or being an open, welcoming trading nation. You, our members, have told us what you want; membership of the single market, consistency in regulations, access to global talent and the ability to trade abroad free from barriers and red tape,” he was quoted as saying in a statement.
These comments came alongside SMMT launching a new digitalisation report produced by KPMG. The transition to digital manufacturing via new technologies had the potential to boost productivity in this sector significantly, the report said.