A failure to protect the UK from increased trade costs after Brexit could make servicing your car “unaffordable”, an investigation has found.
The report found that 80 per cent of the parts used in British-made cars come from overseas, representing £12 billion.
It warned that if trade restrictions come into force following Brexit, a 10 per cent tariff could be added to all imports and exports – this could have the added effect of raising the cost of every car sold in the UK by an average of £2,370.
Oly Richmond, CEO of Servicing Stop, the online servicing provider that commissioned the report, said that losing free trade “will put an end to cheap services and affordable repairs”.
He added: “There is now a massive risk in the industry, a fear that production will potentially move offshore as a way of avoiding tariffs, and the implication on UK servicing providers would be massive.
“A trade agreement is vital in order to preserve the supply chain to the automotive industry and to allow our company, amongst others, to continue to provide affordable rates and prevent car ownership from becoming a luxury.”
According to trade association The Society of Motor Manufacturers and Traders, there are 169,000 people in automotive manufacturing jobs in the UK, but the report said that companies in the automotive sector with substantial operations in Europe could be forced to relocate their UK business on to the continent.
In October last year, Nissan CEO Carlos Ghosn met with Theresa May at 10 Downing Street to discuss the future of the company’s Sunderland factory, which employs 7,000 people.
The Japanese manufacturer was given “support and assurances” that the plant could remain competitive after Britain leaves the EU. However, details of exactly what was promised have remained under wraps.