| Author (Corporate) | United Kingdom: House of Commons: Business, Energy and Industrial Strategy Committee |
|---|---|
| Publisher | United Kingdom: Parliament |
| Series Title | 5th Report |
| Series Details | (2017-19) HC379 |
| Publication Date | 01/03/2018 |
| Content Type | Policy-making, Report |
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Further information UK automotive industry largely export-led The UK automotive industry was largely export-led with Europe as the primary market . The industry was also one of the most closely integrated sectors with the EU. The UK automotive sector's success was built on the complex supply chains that stretch throughout Europe: typically, parts were transferred through different countries before being assembled into the final product. The report took a hard look at potential opportunities arising from Brexit but found it unrealistic to expect an expansion of trade overseas to outweigh the loss of trade to Europe arising from a hard Brexit. The report also stated that any new bilateral trade deals secured by the Government were unlikely to lead directly to a significant increase in investment and jobs in the UK automotive sector. The Committee found that retaining good access to the single market was more important than securing the freedom to secure new trade deals with third countries. No potential benefits On the key issue of the future regulatory regime, the report did not identify any potential benefits from divergence from the EU, only costs. The report recommended the Government sought in the negotiations to preserve existing arrangements for the certification of vehicles throughout the EU, either as part of a Mutual Recognition Agreement or some alternative arrangement. To maximise trade opportunities with the EU – the UK's biggest trading partner - and to provide certainty to global manufacturers, the Government should also aim to retain regulatory alignment with the EU regulatory framework for the short to medium term. The report also called on the Government to seek a deal on immigration that enabled the sector to access the full range of skills it required and further incentivise locating relevant research and development in the UK once we left the EU. Background information The Business, Energy and Industrial Strategy Committee of the United Kingdom House of Commons undertook in 2017 to carry out a major inquiry Brexit and the implications for UK business. One sub-inquiry looked specifically at the impact of Brexit on the automotive sector. The Committee aimed to establish how the interests of different sectors should best be pursued both in the negotiating process and post-Brexit and attempted to examine a range of issues relating to market access, non-tariff barriers, regulation, skills, R&D, trade opportunities and transitional arrangements.The Business, Energy and Industrial Strategy (BEIS) Committee of the United Kingdom House of Commons issued a report The impact of Brexit on the automotive sector on the 1 March 2018. The Committee called for the UK Government to keep the closest possible relationship with the existing EU regulatory and trading framework to give UK volume car manufacturing a realistic chance of survival post-Brexit. The BEIS Committee said that a no-deal put hundreds of thousands of UK jobs at risk and threatened hundreds of millions of pounds of inward investment. The Society of Motor Manufacturers and Traders (SMMT) estimated the introduction of trade barriers to result in a £4.5bn drop in exports while other studies pointed to a greater decline. The report found that non-tariff barriers, in the form of border delays and increased bureaucracy, would also impact on UK competitiveness. The report recommended the Government placed a high premium in its Brexit negotiations on securing frictionless trade for the automotive sector. |
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| Source Link | https://publications.parliament.uk/pa/cm201719/cmselect/cmbeis/379/379.pdf |
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| Subject Categories | Business and Industry |
| Countries / Regions | United Kingdom |
