Britain’s carmakers are warning that a fresh political deal with the EU could be vital to protect production and jobs. New data shows output has slowed and industry leaders say urgent talks are needed to avoid export friction when new rules bite.
Production slips as plants pause amid parts shortages
The latest figures from the industry body show UK vehicle output fell sharply in March. Total production stood at 72,511 units, down 8.2% year‑on‑year.
- Cars: 69,755 units, a small decline of 0.8%.
- Commercial vehicles: 2,756 units, a steep fall of 68.3%.
Manufacturers say a parts supply problem forced a temporary halt at one of the country’s largest factories. That stoppage underscores the fragility of complex supply chains.
Trade group urges UK to be named a ‘trusted partner’ in EU plans
The Society of Motor Manufacturers and Traders has asked the government to press Brussels to include the UK in new EU schemes. Without that status, London would be excluded from benefits designed for European manufacturers.
SMMT leaders argue the industries on both sides are so intertwined that exclusion would be harmful. They warn that measures intended to boost European companies risk unintended damage to UK firms.
What the EU’s ‘Made in Europe’ rules aim to do
The European Commission is advancing a package to shield strategic sectors from unfair competition. Known elements include tighter sourcing rules and incentives for local production.
Key goals of the package
- Bolster European industry against low-cost foreign competition.
- Prioritise sectors seen as strategic, such as steel and automotive.
- Encourage job creation and investment within the bloc.
These rules are part of a wider Industrial Accelerator Act. While intended for EU members, the measures also create a new category of countries deemed “trusted partners” that can access some benefits.
Why the UK could fall outside new protections
Because the UK is no longer an EU member, it does not automatically qualify for the new regime. It must be recognised separately as a trusted partner.
Industry leaders say about 70% of automotive products the UK imports come from EU countries. That deep integration makes exclusion a tangible risk to cross‑channel trade.
Rules of Origin changes pose tariff and market risks
New Rules of Origin checks under the post‑Brexit Trade Cooperation Agreement will tighten from next year.
- Stricter origin thresholds could make cars or components ineligible for preferential treatment.
- Automakers fear additional tariffs on electrified vehicles if parts don’t meet the new criteria.
- Supply chain realignment would add cost and delay to production lines.
For electric and hybrid models, where many components cross borders, even small shifts in rules can hit competitiveness.
Calls for pragmatic diplomacy and an EU‑UK summit focus
SMMT officials want political leaders, including Labour if it is in government, to hold targeted talks with European counterparts. The goal is practical agreements, not grand political gestures.
- Secure UK access to the “Made in Europe” measures as a trusted partner.
- Protect the free‑trade elements of the Brexit deal from erosion.
- Agree transitional solutions to avoid tariffs on electrified vehicles.
Industry representatives say the upcoming EU‑UK summit offers a timely chance to resolve these issues. They stress mutual economic benefit and avoiding measures that would disrupt integrated manufacturing networks.
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