European supplier association CLEPA has issued a statement in response to this year’s Brexit vote. In the statement, which can be read in full below, the association outlines its key requests and priorities for the European supplier community as a result of the Brexit vote.

European Automotive Industry Response to Brexit

Introduction

Today, European automotive suppliers lead the world in the design, engineering and manufacturing of key vehicle components and systems technologies. A crucial factor behind this has been the success of the Single Market and the positive benefits of European Union membership.

The European automotive sector employs more than 12 million people, produces a quarter of the world’s vehicles each year and represents more than 6 percent of the EU’s GDP.

The U.K. plays an important role for our sector, with manufacturers and suppliers highly integrated across Europe. In the past five years, the production of cars in the U.K. increased by 25 percent, up to 1.6 million cars in 2015 and is expected to reach 2 million by 2020. The U.K. is therefore one of Europe’s top automotive manufacturing countries. In 2015, 77 percent of the U.K.’s car production was exported, with the overwhelming majority received by the EU.

The U.K. is also the EU’s second-largest new car market. In 2015, the U.K. imported more than 2.2 million cars – with the vast majority coming from other EU Member States. Taking these figures into account, it is clear that the automotive sector will be highly affected by the outcome of the Brexit negotiations. Our goal is to build upon the success story of recent years and minimize the impact of the U.K. leaving the European Union on our industry.

The Single Market is fundamental to the growth of the European automotive industry and it will remain a key priority for us to maintain and strengthen it to the benefit of all its members.

In light of Brexit, we would like to highlight the following requests and priorities for the European automotive industry to be considered by the British government and the EU institutions.

Main requests

• Transparency of negotiations between the EU and the U.K. and timely disclosure of developments
• A stable and predictable overall framework is crucial for investments and trade
• Ensure provisions are agreed that would allow for Single Market Access and the free movement of labor between the EU and the U.K.
• In the period following the U.K.’s withdrawal from the EU and ratification of an EU-U.K. Free Trade
• Agreement, access and/or membership for the U.K. within the EU Customs Union and the Single Market should be maintained
• Safeguard continuity in the trading relationship between the EU and the U.K.
• Maintain shared regulatory and harmonization priorities
• Continue collaboration on automotive priorities

Priorities

Single Market Access

• Ensure provisions for access to the Single Market including the prevention of tariff and indirect taxes or regulatory barriers being established that would affect the trade of goods, services and skilled labor
• Including the U.K. within the Customs Union with common customs clearance procedures
• Steps should be taken to support integrated supply chains in both the U.K. and across Europe
• The Single Market allows for full and unrestricted trade in goods and services for the EU and U.K. automotive industry. Automotive businesses benefit from tariff-free access to the U.K. market and this should continue without disruption in the transition to a new relationship between the EU and the U.K.

Trade

• Ensuring continuity in the trading relationship with the U.K.
• Alignment of trade priorities and accumulation zones between the EU and the U.K. for free trade agreements with third countries
• Maintaining the freedom of establishment, including the “single passport” system
• Maintaining the freedom of cross-border investment
• The European automotive industry benefits from a number of free trade agreements with third countries.

Therefore, the European automotive industry calls upon the EU institutions and the U.K. government to provide continuity in market access to third countries and to maintain trading benefits from existing and potential future agreements across Europe.

Harmonization

• Ensuring the consistency of regulations and standards between the EU and the U.K., including the continuation of established regulatory framework and mutual recognition of certification
• * The EU and U.K. benefit from a system of harmonized and shared regulation concerning the automotive industry. Therefore the establishment of regulatory continuity to avoid a divergence of EU standards is crucial, under the European type approval system.

There are a number of important areas in which the EU and U.K. should prioritize continuity in a shared regulatory framework:

• Type approval and market surveillance
• Active and passive safety
• Emissions / Euro standards including CO2 and fuel consumption
• End of Life Vehicles (ELV), recycling, REACH and conflict minerals
• Connected and automated driving and data protection
• Intellectual property rights, patents, designs and brands

Continued collaboration on automotive priorities

• Continued collaboration on automotive priorities, including digital, connectivity and ultra-low emission vehicles
• Shared ambition on key environmental goals including CO2 performance and vehicle emission standards, both in the short term actions and long term roadmaps
• Maintaining the U.K.’s access to the EU budget for research and development

Collaboration between the U.K., EU and Member States on shared priorities including emissions, climate change and connected and automated driving should continue, with the U.K. seen as a strategic partner.  Continued collaboration on these projects should be supported by U.K. funding in addition to the existing EU funding framework.

Free movement of labor

• Guaranteed access to labor across the EU and the U.K.
• Employment opportunities across the European automotive industry should be promoted

There is a wealth of talent in our industry and automotive companies must be able to continue to benefit from the free flow of labor to maintain competitiveness, fill skills gaps and foster economic growth and innovation. Therefore we encourage efforts to maintain the free mobility of labor between the EU and the U.K.

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