By Kate Holton
LONDON (Reuters) – British car factories will be forced to close, leading to the loss of thousands of jobs if the government does not renegotiate a Brexit deal, carmaker Stellantis warned on Wednesday.
The owner of the Vauxhall, Peugeot, Citroen and Fiat brands told Parliament that under the existing deal it would face price lists for exports of electric vans to Europe from next year, when stricter post-Brexit regulations come into force.
The carmaker urged the government to reach an agreement with the European Union about extending the current rules on the sourcing of parts until 2027 instead of the planned 2024 change.
In response, a government spokesperson said the Secretary of State for Foreign Affairs had raised the issue with the EU.
“If car production in the UK ceases to be competitive and unsustainable, operations will be shut down,” Stellantis said in a report submitted to a House of Commons committee examining the prospects for the UK car industry.
“Manufacturers will not continue to invest and (instead) move their production operations out of the UK, as has been the case in the past with established British brands such as Ford and Mini. “
Under the trade deal agreed when Britain left the bloc, 45% of the value of an electric vehicle must come from Britain or the EU from 2024 to avoid tariffs.
To save its car industry, Britain will not only have to expand its partnership with the EU but also urgently incentivize battery makers and other car suppliers to set up shop here, Andy Palmer, former head of the EU, told BBC radio. Nissan operations.
“The charge of failure is very clear. That’s 800,000 jobs in the UK, which are jobs related to the automotive industry,” said Palmer, who is also chairman of European battery maker InoBat.
“If there’s no battery capacity in the U. K. , those car brands will move to continental Europe. “
The British motor trade group, the Society of Motor Manufacturers and Traders, said in its paper that existing production functions by the EU and Britain would allow the sector to meet needs for batteries and battery parts.
The warnings echo broader fears within the industry that the U. K. auto sector doesn’t have the capacity or supply chain to transfer to electric vehicles, a massive threat as automakers around the world are settling into sites to build new battery gigafactories.
Britain has attracted investment in electric cars from Nissan and Ford, while other big players are still thinking about where to invest.
Stellantis had announced a 100-million-pound ($126 million) investment in electric cars at its Ellesmere Port site in 2021. He said in his presentation that when he made the announcement he believed he would produce enough portions in Britain or Europe. to meet the needs. standards.
“Now we are not able to meet those rules of origin,” he said, citing external issues such as the war in Ukraine, problems and inflation in the commodity sector.
($1 = 0. 7923 pounds)
(Additional reporting by Gokul Pisharody in Bengaluru, Giulio Piovaccari in Italy and Sarah Young in London; writing by Kate Holton; editing by Richard Chang and Jason Neely)
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