UK EU membership is crucial, says the automotive industry.
Being part of the European Union is vital for future success, said Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT) on presenting a new report “The UK automotive industry and the EU”.
Hawes said that “this report, and our member survey, shows that Britain’s EU membership is fundamental to investment, growth and jobs in automotive companies of all sizes.”
He added:
“The recent success of the UK automotive sector is due to its global competitiveness; competitiveness that is enhanced by a supportive business environment at home and access to the huge single market.”
The term ‘single market’ refers to a group of nations that trade with each other in goods and services without imposing taxes.
The United Kingdom must play a key role in shaping EU regulations, budgets and policies if it is serious about maintaining its position and increasing access to growing global markets.
Hawes added “We must also increase our share of EU innovation funding to take advantage of the expertise the UK has in low carbon and other automotive technologies and secure the long-term future of the automotive business in the UK.”
UK EU membership vital for UK automotive market
John Leech, Head of Automotive at KPMG in the UK, said the report demonstrates how vital the European Union is to the UK automotive market, which today has become a highly globalized industry “and integrated within the EU.” This integration gives manufacturers from around the world with bases in the UK access to consumers throughout Europe.
According to JPMG’s analysis, it is not a question of the emerging markets versus the EU for the automotive industry, “they want to do business with both,” Leech pointed out.
UK EU membership give UK global clout
Leech said:
“The automotive businesses we spoke to also see the EU as an important bargaining force in global trade negotiations.”
“Moreover, research and development, which is vital to the UK’s ability to be at the forefront of innovation in car manufacturing, is both heavily funded by the EU and requires access to the expertise and free movement of skilled engineers within the EU.”
“While our report outlines the importance of EU membership to the UK automotive industry, it also poses some challenges to the sector. There is a clear demand for regulatory reform and consistent application of regulation so that complexity can be reduced.”
Staying in EU better for UK businesses
An SMMT survey involving its members, i.e. businesses of all sizes in the industry including distribution, manufacturing, aftermarket and other firms in the supply chain, found that 92% of the UK automotive industry firmly believe that staying in the EU is better for their business.
The vast majority of business people in the UK from all sectors of the economy are firmly in favor of remaining in the United Kingdom.
(Source: SMMT)
Over 70% of interviewees said that if the UK withdrew from Europe it would have a negative impact in their business over the medium-to-long-term.
Reflecting the findings of the KPMG report, SMMT members clearly want to safeguard the benefits of EU membership while at the same time calling for reform.
EU membership allows the industry to deploy skills and expertise seamlessly across the EU to meet local needs.
SMMT members added, however, that the EU needs to improve the way it operates, especially in its application of regulations. They would like to see reforms in the EU budget and the creation of a more stable and successful Eurozone.