Today, automobile manufacturers operate more than 300 assembly and production plants across the European continent. They often manufacture components – like engines and transmissions – in one country, and assemble the final vehicle in another. Auto makers are part of a highly integrated and complex manufacturing network spanning right across Europe.
Needless to say, the European Single Market has been fundamental to the success of this business model by providing for a high level of economic and regulatory integration. Any changes to this deep economic and regulatory integration between the EU and the United Kingdom will have an adverse impact on auto manufacturers with operations in the EU or UK.
In April 2017, the European Automobile Manufacturers’ Association (ACEA) issued its first position paper on Brexit, with the aim of highlighting the potential damage that Brexit could do to the industry’s competitiveness.
Now, ACEA has published a new position paper that dives deeper into the key automotive issues that need to be addressed in the current political negotiations. This includes constructive recommendations from the auto industry on how various sector-specific issues should be managed; including type approval, compliance with the EU’s CO2 targets set for 2021 and customs procedures.
To that end, this paper will look at Brexit from the following viewpoints:
- The withdrawal agreement and the transitional arrangement;
- The framework for the future relationship;
- Key future relationship issues;
- The no-agreement ‘cliff-edge’ scenario.