The Society of Motor Manufacturers and Traders (SMMT) has reiterated its stance against a ‘no deal’ Brexit, citing new research.
According to an SMMT member survey, 74.1% of UK automotive firms think leaving the EU without a deal would damage their business, with less than 9% foreseeing any positive impact.
In addition, 68.5% said their profitability would be negatively affected, with 53.9% concerned about their ability to secure new overseas business and a similar number worried about maintaining investment in their UK operations.
Half of the respondents said a ‘no-deal’ scenario would undermine their ability to maintain their existing workforce and more than half of respondents claimed their operations have already suffered as a result of uncertainty about future trading arrangements.
Almost a third said they had postponed or cancelled UK investment decisions because of Brexit, with one in five having already lost business as a direct consequence.
More than half said contingency plans are now being executed, with 12.4% relocating UK operations overseas and the same proportion already reducing employee headcount, although 20% have invested in UK operations and 15% have expanded their UK footprint.
Many have also made alterations to logistics and shipping routes, investment in warehousing and stock and adjustments to production schedules.
Speaking at the SMMT’s annual dinner, where the survey results were announced, chief executive Mike Hawes said: “Frictionless trade as part of the EU single market and customs union has driven the success of the UK automotive industry so the fact we are leaving is already painful, and already causing damage.
“Leaving without a deal would be catastrophic – plants will close; jobs will be lost. Leaving is not what we wanted, but we recognise that the withdrawal agreement has been hard-fought and, crucially, delivers a transition period which steps us back from the cliff-edge.
“We need a deal now, and we need an ambitious deal for the future that guarantees frictionless trade with our most important market – nothing else will do, and we urge all parties to remember what’s at stake.”