Weekly News Review | 2 July 2018 | Automotive Purchasing and Supply Chain Automotive Purchasing and Supply Chain

Talking Point

Danger; the cliff edge is getting closer?

Last week I attended the Society of Motor Manufacturers and Traders (SMMT) tenth International Automotive Summit in London. For perhaps the first time at such an event, discussions on Brexit took centre stage and a spirit of optimism was hard to find. One of the keynote speakers was Chris Grayling MP, the UK’s Secretary of State for Transport, and his speech was hardly encouraging as he merely trotted out the tired old government line on the issue without offering any clarification of its stance. One line in particular made an impression on me for its obfuscation, the line where he declared that the government’s goal was “to maintain as frictionless trade as possible with the European Union.” What on earth does this mean? As an example of political claptrap it takes some beating. Perhaps it’s not for nothing that he is referred to as ‘failing Grayling.’

The SMMT has consistently championed the need for swifter progress on Brexit and a deal with the EU that, as a minimum requirement, maintains the UK’s membership of the customs union and the single market. The level of investment into the automotive industry in this country is dropping and government negotiators seem to be no nearer to finding a solution with time running out.

At the pre-event press conference, Dr. Ian Robertson, BMW Group’s special representative in Great Britain, denied that the company, which manufactures the MINI at its Oxford plant and Rolls Royce in Goodwood, was planning to leave the UK. This contradicted comments the day previously from another BMW executive who suggested that BMW would close its British factories if Brexit leads to serious supply chain disruption. Robertson went on to warn that, in the event of a ‘hard Brexit’, UK-based vehicle manufacturers would need to invest in warehousing and customs facilities which would increase costs and threaten competitiveness.

More than 1,100 trucks arrive in the UK every day from the EU, bringing components to vehicle and engine plants. This frictionless movement of goods is something which the automotive industry in this country has relied upon to support its growth over recent years. Now, with decisions on new vehicle models for UK production due imminently, the government must stop dithering and must take steps to boost investor confidence and safeguard the thousands of jobs which depend on the automotive sector. If it fails to do so, it will not readily be forgiven.

Sam Ogle

Sam Ogle

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