The President of the UK’s Society of Motor Manufacturers and Traders (SMMT) last night urged the British Government to “make the right decisions” and stay in single market as UK motor industry faces £4.5 billion car tariff threat.
New SMMT analysis suggests that EU tariffs on cars alone could add at least an annual £2.7 billion to imports and £1.8 billion to exports. Import tariffs alone could push up the list price of cars imported to the UK from the continent by an average of £1,500 if brands and their retail networks were unable to absorb these additional costs.
He went on to say, “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.”
The President’s address to more than 1,100 industry leaders and government officials came days after SMMT published production figures showing UK car makers are on track to set a new record for exports and beat the production volumes achieved last year. He warned, however, that this success was the result of multi-billion pound investment decisions made years before the EU referendum was even a prospect. And he underlined the industry’s recent impressive growth and outlined the risks to investment and success if the benefits of the single market were lost.
Digitalisation of Automotive Manufacturing
Jones was speaking as the SMMT launches a new report produced by KPMG, The Digitalisation of Automotive Manufacturing in the UK.3 According to the report, the transition to digital manufacturing through new technologies such as 3D printing and artificial intelligence, has the potential to significantly boost productivity still further. More effective use of data, meanwhile, will reduce plant maintenance downtime, speed up product planning and improve quality, meaning consumers could see the time they have to wait for a new car cut by a third.
Jones said, “The so-called fourth industrial revolution will be a step change in manufacturing, with production lines developing more over the next five to 10 years than in the past half century.”
All of this is set to add an annual £6.9 billion to industry turnover, including a £2.6 billion supply chain boost, while also delivering £74 billion to the wider UK economy over the next two decades. Realising this potential will require significant investment – and that will depend upon maintaining the UK’s international competitiveness and being part of future regulatory and standard development.