Brexit halves new investment in British car industry

Society of Motor Manufacturers and Traders chief Mike Hawes said the British government’s current position — leaving the EU single market and the customs union — would hurt the car industry. (Reuters)
Updated 26 June 2018

Brexit halves new investment in British car industry

LONDON: Uncertainty over Brexit has halved new investment in the British car industry as Prime Minister Theresa May’s government current plans for trade after Britain leaves the EU are unrealistic, the biggest car manufacturing lobby said on Tuesday.
Public announcements of fresh investments into new plant, machinery, tooling and equipment, models and model development fell to £347.3 million ($461.1 million) between January and June 21, 2018, down from £647.4 million in the first half of 2017.
“There is growing frustration in global boardrooms at the slow pace of negotiations,” said Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT).
“Government must rethink its position on the customs union.”
At stake is the future of one of Britain’s few manufacturing success stories since the 1980s: a car industry employing over 800,000 people and generating turnover of $110 billion.
With only nine months left until the United Kingdom is due to leave the EU, little is yet clear about how trade will flow as Prime Minister May, who is grappling with a rebellion in her party, is still trying to strike a deal with the bloc.
Under the current timetable, both London and Brussels hope to get a final Brexit deal in October to give enough time to ratify it by Brexit day in March 2019, though few diplomats expect the deal to be struck until months later.
The nature of the future relationship with the world’s biggest trading bloc remains unclear and there is a growing sense of nervousness among business leaders about the prospect of Britain crashing out of the bloc without a deal or with a deal that would silt up the arteries of trade.
Around 52 percent of the UK’s total $1.1 trillion trade in goods last year was with the EU so May wants to sign a free trade agreement and negotiate an as yet relatively undefined customs arrangement to ensure as frictionless trade as possible.
SMMT chief Hawes said the British government’s current position — leaving the EU single market and the customs union — would hurt the industry.
The EU customs union clubs the 28 EU members in a duty-free area where there is a common import tariff for non-EU goods.
“The current position, with conflicting messages and red lines goes directly against the interests of the UK automotive sector which has thrived on single market and customs union membership,” he said.
“There is no credible ‘plan B’ for frictionless customs arrangements, nor is it realistic to expect that new trade deals can be agreed with the rest of the world that will replicate the immense value of trade with the EU.”


Report: 2 Iranian lawmakers arrested for ‘disrupting’ market

Updated 22 August 2019

Report: 2 Iranian lawmakers arrested for ‘disrupting’ market

  • The report did not reveal if they have been charged with any financial crimes
  • Iran arrested several people since 2018 on corruption charges

TEHRAN: Iran’s semi-official Fars news agency says two lawmakers have been arrested for unspecified actions described as “disrupting” the country’s car market.
The report says the two lawmakers — Fereydoun Ahmadi and Mohammad Azizi — were initially taken to the Evin prison in Tehran but they were later released for about $85,000 in bail.
The report didn’t specify if the two have been charged with any financial crimes.
Iran is trying to crack down on corruption and has arrested several persons since 2018. Two prominent local businessmen have been hanged.
Iran’s economy nosedived since the US pullout from the nuclear deal last year. Prices of cars have skyrocketed as Western manufacturers pull out of the country and foreign-produced parts are becoming harder to find. China is trying to fill the void.