The result of the 23rd of June could affect car manufacturers based in the UK in a number of ways, according to industry experts.

Partner at Eversheds Simon Jones, tells Motor Finance that Brexit could have an adverse effect on OEM’s investment in the market.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Jones explained: "It is generally expected that Brexit will have a negative impact on the auto industry – at least for the volume manufacturers. Much of the investment into the UK’s resurgent auto industry by global manufacturers is based on the UK’s open and free access to all European markets and to the UK being an active and influential member of the EU."

Another impact cited by Jones is a softening of demand for new cars and commercial vehicles caused by a slow-down in economic activity.

Jones added that the profitability of OEMs could be affected from exchange rate volatility, he said: "Whilst is true that the UK’s exports will become cheaper, vehicle components are imported and will therefore become more expensive."

Opportunities

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

NACFB board member Graham Hill said that Brexit can be an opportunity to increase the sale of cars, built in the UK, into other countries that UK-based manufacturers have struggled to sell into in the past once the country has negotiated a free trade agreement.

Hill explained: "This won’t allow us to start exporting cars to these non EU countries without a free trade agreement because we already do. But it means that tariffs will be removed making the cars exported from this country cheaper. China, India, US, Australia all present opportunities if we can get stuck into trade negotiations. The EU has made such a cod’s ear of its negotiations with non EU countries, mainly because each deal has to be ratified by all 28 (now 27) member states."

"Anything that Europe wants to export to non EU countries with which the EU doesn’t have a free trade agreement and we have will want to manufacture their products in the UK. May not be such a bad deal after all albeit I feel we have a lot of pain to suffer before we actually get there," he added.