The Society of Motor Manufacturers (SMMT) today called on the EU to amend its proposed Industrial Accelerator Act (IAA) so as to not exclude UK automotive products from incentives afforded to EU-based manufacturers.
The call comes as the UK trade body meets with EU representatives in Brussels lobbying for the move. The IAA is in draft format and it is expected to take more than a year before it is ratified.
In the meantime there is uncertainty in the UK as to the outcome, hence the intensive lobbying by the SMMT.
The SMMT said excluding UK Automotive from the IAA’s ‘Made in Europe’ policy would inflict significant harm on the UK and EU auto manufacturing capability, disrupting supply chain resilience and undermining the objectives of the IAA.
It said the EU-UK automotive partnership, built over more than 40 years, is valued at €80 billion annually – with the balance of trade favouring the EU.
It added that the UK remains the EU’s largest export market for passenger cars – and vice versa – worth an annual €39.7 billion to EU based manufacturers.
And, additionally, the EU sells €9.1 billion worth of typical automotive components to UK Automotive every year – more than to any other global market, including the US and China.2
The ‘Made in Europe’ policy, as drafted, threatens this valuable trade by excluding UK automotive products from incentives afforded to EU-based manufacturers – notably incentives connected to the greening of corporate fleets, which account for around 60% of the EU new car market, and CO2 super credits.
Mike Hawes, SMMT chief executive, said, “Brexit put the resilience of our shared industry under enormous stress but manufacturers have overcome those challenges to grow our trade in electrified vehicles alone to record levels.
“If the Industrial Accelerator Act proceeds as drafted, it threatens to reverse progress, undermining the Trade and Cooperation Agreement all sides worked so hard to deliver and jeopardise our respective competitiveness, damaging to jobs, investment and innovation.”
