Total alignment with EU rules will help minimise the harmby Rachel Reeves / March 13, 2018 / Leave a comment
The car industry is one of our great manufacturing success stories and supports thousands of jobs across the UK. We need to be more vigilant than ever about potential risks to this key sector.
One area that presents the automotive industry with an array of challenges is Brexit. The Business, Energy and Industrial Strategy Select Committee, which I chair, decided to investigate.
Our report—the second of our sector-based Brexit inquires—was published last week. The Committee recognises the potentially different impacts of Brexit on different sectors of the economy and the need for different negotiating priorities in each.
Getting stuck into the detail of how sectors operate highlights the reality of what Brexit could mean for jobs, trade, investment decisions and, ultimately, prices and consumer choice. On all these fronts, our Committee is unanimous in wanting to ensure the government pursues in negotiations an outcome that is beneficial for the UK, rather than one guided by some abstract sense of ideological purity.
For the automotive sector, most of our trade is with Europe. Global companies make tough decisions about where to locate production for the European market, which is served by complex supply chains. Profit margins are small; efficiency is everything. Shared standards for components make production more efficient and underpin consumer confidence. We found no benefit to post-Brexit regulatory divergence, only costs.