Brexit: Claire Fox says UK can 'survive and thrive'
Bosses said they were pleased the historic Christmas Eve agreement had removed the threat of punitive tariffs under a no deal departure on December 31. But they said the deal had provided few details for the motor trade and related industries.
The deal that we now have raises as many questions as it answers
Vehicle Remarketing Association (VRA) boss Sam Watkins said: “Let’s be clear on this – any deal is good news because it avoids the kind of tariffs that would’ve been attached to no deal.
“It is something that should be a huge cause for relief.
“However, the deal that we now have raises as many questions as it answers.
“It is generally being described as ‘thin’ and that is accurate in that there are several areas where there is very little detail for the motor industry or remarketing.
“We are probably entering into a process now where those points are going to be worked through but it seems that some will be easier to resolve than others.”
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Ms Watkins said industry figures hoped the degree of certainty that was provided by the deal would see the green light given to short-term investments in manufacturing such as the new Nissan Qashqai in Sunderland.
She said: “The threat of motor manufacturing in the UK potentially unravelling overnight has been removed and this should mean that there is no immediate question mark over UK factories and supply chains.
“However, looking ahead, substantial costs have been added in terms of the new customs arrangements, and the regulatory background against which car makers operate is unclear in several important areas.
“Presumably, these will be clarified in the coming months and years but it does perpetuate an effect that has been present ever since the Brexit referendum – that it is difficult to make plans and for investment decisions to be finalised without all of the facts available. There remains a lot of uncertainty.”
Ms Watkins said there were special difficulties surrounding rules of origin arrangements that could have implications for manufacturing in the UK.
Her warnings came as Japanese carmaker Honda said it had been forced to halting output at its British factory on today and tomorrow because of global supply delays.
The company also suspended production for a few days in December as some major container ports, such as Felixstowe, struggled to cope with disruption caused by COVID-19, pre-Brexit stockpiling and Christmas.
The pandemic has upended normal trade flows, leaving stranded empty cargo containers in the wrong places, spawning bottlenecks around the world.
Output at Honda’s plant in Swindon, Wilts, only resumed yesterday after the festive break.
A spokesman said: “The situation is currently being monitored with a view to re-start production on Thursday 7 January.”
Major automakers operate just-in-time manufacturing, meaning some parts arrive moments before they are fitted to vehicles.
Honda made just under 110,000 Civic cars in Britain in 2019 but is due to permanently close the site this year.
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Ms Watkins said: “It’s quite difficult to separate the negative effects of the pandemic and Brexit but getting hold of a number of popular new models is almost certainly going to be tricky in 2021.
“For a motor industry that has finished last year around 30 percent down in new car sales compared to 2019, this is not good news, and there will be knock-on effects for the used sector that will persist into the medium term.”
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