The Vehicle Remarketing Association (VRA) has warned that the new ‘thin’ Brexit deal has left many questions unanswered, leaving the UK automotive industry in a precarious position.
The trade organisation says that several key points surrounding the future of manufacturing and cross-border movement of vehicles remain vague or undefined.
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Sam Watkins, chair at the VRA, said: “Let’s be clear on this – any deal is good news because it avoids the kind of tariffs that would’ve been attached to no deal. It is something that should be a huge cause for relief.
“However, the deal that we now have raises as many questions as it answers. It is generally being described as ‘thin’ and that is accurate in that there are several areas where there is very little detail for the motor industry or remarketing. We are probably entering into a process now where those points are going to be worked through but it seems that some will be easier to resolve than others.”
Watkins said that the hope was that the degree of certainty now present would enable near-term investments in manufacturing, such as the new Nissan Qashqai in Sunderland, to go ahead.
“The threat of motor manufacturing in the UK potentially unravelling overnight has been removed, and this should mean that there is no immediate question mark over UK factories and supply chains.
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By GlobalData“However, looking ahead, substantial costs have been added in terms of the new customs arrangements, and the regulatory background against which car makers operate is unclear in several important areas.
“Presumably, these will be clarified in the coming months and years but it does perpetuate an effect that has been present ever since the Brexit referendum – that it is difficult to make plans and for investment decisions to be finalised without all of the facts available. There remains a lot of uncertainty.”
Notably, there were special difficulties surrounding the rules of origin arrangements, Watkins added, that could have implications for EV manufacturing in the UK.
Essential remarketing services such as vehicle storage, logistics and services support will also be more critical than ever in the UK during 2021, said the VRA.
“The post-Brexit, coronavirus market is one in which the core functions of remarketing have become more important than ever. When it comes to sourcing the right vehicles at the right price, ensuring their condition, retailing them and then getting them to the customer, all in a secure fashion – then the expected standards in every single one of these areas are being forced upwards by market conditions.
“There is every reason to expect these trends to continue. Certainly, as a trade body, we see the next few months as one where our role is to guide and support our members through times that continue to be turbulent and which promise to remain so for some time.”
