Britain completing its exit from the European Union without a new trade agreement with the bloc would be a “disaster,” European car industry representatives warned on Monday.
“Negotiators on both sides must now pull out all the stops to avoid ‘no deal’ at the end of the transition,’’ the European Automobile Manufacturers Association (ACEA) said.
According to the ACEA statement, a no-deal “would cost the pan-European automotive sector some 110 billion Euros (130.5 billion dollars) in lost trade over the next five years, putting jobs at risk.”
The trade group urged EU and British negotiators “to secure a deal urgently that delivers zero tariffs, modern rules of origin and avoids different regulations across the channel.”
Britain formally left the EU in January and entered a transition period which runs until the end of the year, during which it still belongs to the EU single market and customs union.
“If no new agreement is struck by Dec. 31, trade between Britain and the EU would switch to so-called World Trade Organisation (WTO) non-preferential rules.
“These include tariffs of 10 per cent on cars and of up to 22 per cent on vans and trucks, which would lead to higher production costs and higher consumer prices,’’ ACEA said.
Britain has a sizeable car industry, mostly focused on EU export markets.
In 2019, some 1.3 million passenger cars were produced in the country, including by Nissan, Honda, BMW-Mini and Opel/Vauxhall.