AID Newsletter banner July 2014 the publication for automotive industry executives
Subscribe  |  FREE SAMPLE   Front Page Editions  |  Current Issue page 1  |  BACK COPIES  |  Info  |  REPORTS  |  CONSULTANCY SERVICES  |   CONTACT  |  MEMBERS 

May unveils hard Brexit flight plan 
Peter Schmidt | Editor

Published: Wed, 18th January 2017 11:38:08 GMT

RHA chief executive Richard Burnett with Theresa May MP

Open quote signNow we know it. Theresa May and her government have now made it abundantly clear that post-Brexit Britain cannot remain within the European single market. 

That said, however, on the one hand she wants on-going free trade between the UK and the rest of the EU while on the other she vehemently rejects the future free movement of EU passport holders. 

Expectedly, in forthcoming negotiations Britain will try and cherry-pick by accepting the advantages of tariff-free trade while rejecting the cast in stone EU obligations that go with it. 

So far at least, the EU has made it abundantly clear that the single market's primary four freedoms - covering the unimpeded flow of tariff-free goods, services, capital and labour – are non-negotiable.

The way yesterday’s Theresa May statement is read, Britain is adamant to regain full control of its borders. 

“We will get control of the number of people coming to Britain from the EU”, May said.

 It means looming immigration controls for EU citizens. 

On that premise alone, EU negotiators are unlikely to give in to the demands for continuing tariff-free trade with post-Brexit Britain. 

What does it mean for the autoindustry?

If there is a canary in the deep mine of the European automotive industry, from this day forward it is a wise thing to keep an eye on it. 

In light of yesterday’s developments, chances are that the canary may be about to drop dead.

If, as is likely, that both sides will stick to their principles, Britain is unlikely to retain tariff-free access to EU markets and vice versa. Contrary to earlier hints given to Nissan, implying no change in future UK-EU automotive trade, based on yesterday’s UK government revelations, there will be change. 

A great deal of likely change.

Chilling prospects for the likes of UK-based Nissan, Toyota, Honda, Mini and of course Jaguar Land Rover. 

The same goes for German carmakers who traditionally export more German-made cars to the UK than to any other country, including both China and the US. 

Brussels, it seems, despite the expected hard lobbying from the likes of Audi, BMW and Mercedes for instance, will simply be left with no option but to play hardball. 

That’s simply because the UK cannot be seen to pick what it likes from today’s EU trade policies. It’s all or nothing. That’s hardly surprising.

With right wing political elements gaining in strength across the European continent, a favourable exit deal for Britain could conceivably lead to other EU countries leaving the EU for a similar or even more favourable deal. 

For this and many other reasons it is unlikely that Britain will get what it wants. 

That probably means a full break away from EU Europe. 

Apart from anything else, that’s bad news for Britain’s automotive workforce and UK motorists. 

Foremost, on the issue of EU immigration the UK has dug in its heels. 

With inevitable tariffs, likelihood now is that new car prices in post-Brexit Britain will rise a great deal. 

To paraphrase one of Donald Trump’s Tweets: 

‘Theresa get that. Free access to 440m EU 27 consumers without free movement of EU passport holders; think again; NO WAY!
Close quote sign

To continue reading this article, please register for a free sample without obligation...

Please note that is a subscriber-only site, and as such it can only be viewed by subscribers to the newsletter.