Hard Brexit would cost $130 billion, British automakers warn


BRUSSELS — Europe and Britain’s car industries called on Monday on the two sides to urgently clinch a free trade agreement, warning that a disorderly Brexit would cost the sector 110 billion euros (£101.79 billion, $130 billion) in lost trade over the next five years.

Less than four months before a post-Brexit transition period ends in December, Britain and the European Union’s talks on a trade deal for 2021 onwards have been plunged into crisis, after Britain tabled a plan to break the divorce treaty both sides signed in January.

Failure to secure a deal would lead to tariffs. That would make vehicles more expensive and cause a drop in demand that could eliminate production of 3 million vehicles over the next five years, 23 auto industry associations said in a joint statement on Monday.

That could cost EU plants 57.7 billion euros and UK factories 52.8 billion euros, they said.

“These figures paint a bleak picture of the devastation that would follow a ‘no deal’ Brexit,” Mike Hawes, chief executive of Britain’s Society of Motor Manufacturers and Traders (SMMT), said.

Associations that signed the statement included SMMT, the European Automobile Manufacturers’ Association, the European Association of Automotive Suppliers and Germany’s Association of the Automotive Industry.

A hard Brexit would see World Trade Organization tariffs applied to trade across the English Channel, adding to pressure on Europe’s car industry which is already reeling from the economic fallout of the coronavirus pandemic.

The tariffs, of 10% for cars and up to 22% for trucks and vans, would “almost certainly” need to be passed onto consumers, the associations said.

These losses would come on top of an estimated 100 billion euros in lost UK and EU production value so far this year, as car sales plunged during the pandemic.

New passenger car registrations in the EU dropped by 38% in the first half of 2020, compared with the same period last year, while sales in Britain saw a 49% drop.



Source link

Discover

Sponsor

Latest

Could Propecia Up Young Men’s Suicide Risk?

"Sexual dysfunction in younger men can result in depression and, in a subset of these...

Biden urges patience with vote count, says he’s on track to win

Joe Biden, 2020 Democratic presidential nominee, left, and wife Jill Biden arrive to an election night party in Wilmington, Delaware, U.S., on Wednesday,...

Biden scores big fundraising hauls on vice presidential debate day

A digital truck broadcasts the debate between U.S. Vice President Mike Pence and Democratic vice-presidential nominee Kamala Harris outside a tavern in San...

New York City will close schools for in-person learning, mayor says

New York City Mayor Bill de Blasio stands at P.S. 188 as he welcomes elementary school students back to the city's public schools...

2021 Acura TLX First Drive | Impressions, specs, photos

Buildup for the 2021 Acura TLX started more than a year ago when Acura released the stunning Type S Concept. It was long,...