Politicians and economists have repeatedly warned of the detrimental economic implications of a hard Brexit on the UK economy, urging negotiators to ensure a deal with sufficient access to the EU market is agreed to prevent significant disruption and inflation from hitting Britain.
Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), warned on Tuesday that a no-deal Brexit “isn’t an option” for the UK’s car industry.
“It would be seriously damaging to the industry not just in the UK but in Europe as well,” Mr. Hawes told reporters on July 31.
He also said auto manufacturers were “increasingly concerned” about the uncertainty of the UK’s post-Brexit relationship with the EU, and insisted more clarity is needed for businesses to make contingency plans and take necessary steps to prepare for Brexit.
This is not the first time warnings specific to the auto industry have been made by industry leaders and economists.
Directly and indirectly employing over 800,000 people in Britain, carmakers form a key segment of the national economy, and the government has typically attempted to bolster the industry by providing subsidies and other incentives for manufacturers to locate in the UK.
However, with Brexit looming large and the prospect of a hard Brexit looking increasingly likely, business confidence is dwindling, especially as the government struggles to unite behind Prime Minister Theresa May’s negotiating strategy.
In the event of a hard Brexit, WTO trading rules would apply, resulting in the enforcement of tariffs and other trade barriers, limiting the UK’s access to the European market. Such a trading arrangement is likely to put many products under inflationary pressure and potentially cause disruption to existing supply chains, in the auto industry and beyond.
Sourse: sputniknews.com
