EU automotive industry cautious over Brexit trade deal

Brussels – The European Automobile Manufacturers’ Association (ACEA) has described the free-trade agreement between the EU and UK as a “great relief for European automobile manufacturers, allowing the sector to avoid the catastrophic effect of a no-deal Brexit.”

“There is no other industry that is more closely integrated than the European automotive industry, with complex supply chains stretching right across the region,” said ACEA director general Eric-Mark Huitema.

However, ACEA said it cannot make a full assessment of the implications for EU auto manufacturers and their supply chains until all the technical details have been made public.

“Major challenges still lie ahead, as trade in goods will be heavily impacted by barriers to trade in the form of new customs procedures that will be introduced,” Huitema cautioned. 

With around 30,000 parts used in the construction of a single car – and many more in the construction of commercial vehicles – the automotive industry relies heavily on smooth and just-in-time delivery, ACEA noted.

According to the association, the deal struck by EU and UK negotiators introduces much more red tape and regulatory burden for the industry.

Every year, it added, almost 3 million motor vehicles worth €54 billion are traded between the EU and the UK, and cross-Channel trade in automotive parts accounts for almost €14 billion.