UK Society of Motor Manufacturers and Traders (SMMT):
SMMT’s third annual trade report, Driving Global Britain, is published in a year when markets around the world shut down as individual countries grappled with the pandemic, every sector had to readjust expectations.
Vehicle export revenues reached £27 billion in 2020, making them more valuable to the UK than power-generating machinery and gold, even during a year when the global pandemic disrupted trade flows and shut down markets around the world. The UK automotive sector as a whole generated a total trade revenue of £74 billion, underlying its monumental importance to international trade, with more than 80% of British-built cars and more than 60% of light commercial vehicles destined for export.
Britain’s automotive sector is a powerhouse of international trade. Many countries have automotive industries, some larger in size. But no other nation can boast the depth and variety of the UK’s automotive sector. From specialist sports cars and high-end luxury vehicles to mass-market volume cars, from the vans and trucks that sustained supermarkets and broader society to the world renowned British buses and taxis, the UK produces (and exports) it all.
With hopes rising worldwide that the pandemic is now in retreat, the UK’s trade policy must now take advantage of the opportunities from a post-Brexit, post-fossil fuel world to restore growth and jobs with automotive central to this ambition.
With the global car market expected to grow significantly in regions such as Asia and Eastern Europe, SMMT is calling for future trade deals to include dedicated automotive annexes and provisions to reduce tariffs and regulatory barriers. It also recommends establishing Rules of Origin that will reflect the UK’s future supplier base as manufacturing moves away from the combustion engine, as well as ensuring manufacturers have the ability to recruit top talent from around the world to drive growth.
The report also highlights the importance of trade with the EU. Around half of all cars made in Britain are exported to EU member states, while almost all vans exported by the UK end up on European roads. While the industry looks ahead to post-Brexit trading opportunities, the EU will remain a central trade partner.
With the UK at the forefront of the global electric vehicle revolution, trade policy should also ensure that Rules of Origin reflect appropriate sourcing of batteries for electric cars, so that UK-built zero emission vehicles can be freely exported around the world and play an essential role in reducing emissions.
Electric Vehicle Outlook 2021: https://about.bnef.com/electric-vehicle-outlook/