The news that British businesses could be given a 21-month transition period after Brexit has been greeted positively by the Society of Motor Manufacturers & Traders (SMMT).
The Government proposed a deal, outlined on the 14th November, which would allow UK-based businesses to continue to operate as normal until the end of 2021, when any new international trading regulations would come into effect.
According to Autocar, MMT CEO Mike Hawes said: “For the automotive industry, Brexit is about damage limitation. The outline agreement is a positive step in avoiding the devastating consequences of no-deal and securing a transition period”.
80% of cars produced in Britain currently go in to export, meaning manufacturers are concerned that the addition of customs and security processes at ports could slow production and shipping ad raise distribution costs.
The temporary maintenance of existing agreements would allow manufacturers to sell more cars and strengthen their market position prior to Britain’s departure from the EU customs union.
But lack of confirmation remains a problem for UK manufacturers, which, according to Hawes, are seeking “certainty and a,bition when it comes to securing a competitive future.”
CEO of Aston Martin, Andy Palmer is equally concerned that plans for a grace period might not come to fruition, stating: “I don’t know whether we have more clarity or less clarity”. However, he is relieved that “at least we have some sort of plan on the table”.
Final talks concerning the economic and industrial relationship will continue after the UK legally leaves the EU on 29 March 2019.
