The expert said that the British market is waiting for Brexit

The expert said that the British market is waiting for Brexit

June 10, 2020 0 By autotimesnews

Once the automotive world began to recover from the pandemic crisis, there is still an imminent threat of Britain leaving the European Union. Read more about Brexit news on British car market

Britain’s position remains that it plans to exit the EU at the end of this year, while the automotive industry’s position remains that anything other than a free trade agreement between the UK and the EU will have disastrous consequences for the industry. Beginning in 2021, vehicles imported from abroad will be subject to a 10% tariff if the UK and the EU do not reach an agreement. About 81% of all cars built in the UK last year were exported, with the EU accounting for almost 55% of the total, amounting to 576,000 cars.

According to Felipe Munoz, a global analyst at Jato Dynamics, the pandemic will not affect the impact on the UK auto industry. “The economy has already absorbed most of the risks associated with Brexit,” he says. “All the decisions that should have been made because of Brexit have already been made, and this crisis will not change them.”

However, the pandemic threatens to make the financial situation of some automakers even worse and cancel any progress made in the recovery. “At the end of 2020, the unsuccessful Brexit runs the risk of nullifying efforts to get the auto industry back on track,” says Eric-Mark Whitema, CEO of the European Automobile Manufacturers Association (ACEA).

For example, Jaguar Land Rover noted that Brexit would cost £ 500 million a year only for exporting vehicles, and ACEA notes that since the UK produces very few electric motors and batteries, electric cars are particularly susceptible to high tariffs, given how a large share of the battery in the total cost of the car.

New trade agreements with countries outside the EU are also unlikely to be ready by 2021, and the UK may find that conditions will be different than before the crisis, as countries may have been frightened by how much they are exposed to global supply chains and are more relevant. internal problems that need to be addressed first.