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Car makers to take a ‘risk adverse’ approach to sales amid potential post-Brexit tariffs

by LLB staff reporter
18th Sep 23 12:21 pm

Car makers are “erring on the side of caution” over electric car sales in 2024 due to planned European Union post-Brexit tariffs.

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT) has said on Monday that they will be taking a “risk adverse” approach to sales next year.

Car manufacturers in the EU and the UK are urging Brussels to delay the post-Brexit tariffs on exports of cars made in Britain.

From January 2024 the EU’s rules of origin provision will come into force and tariffs of 10% will be placed on electric cars if at least 45% of their value is not originated in the EU or UK.

Hawes told reporters, “We are still optimistic that an agreement will be reached.

“It makes common sense because the last thing you want to do is put additional tariffs on the very vehicles you are encouraging people to buy.

“However, the fact that we’re in September, most companies will already have made their decision, certainly on the first half of next year about product allocation.

“So invariably you will take a risk averse approach to that.

“And I don’t think you can actually assume that any agreement will be reached.

“I said we’re optimistic but I can see this going down, like we did with Brexit, to Christmas Eve or something like that.”

Alex Smith, managing director of Volkswagen Group UK, was asked for his view on the potential application of post-Brexit tariffs on electric cars.

He told reporters on Monday, “We’re on a path to electric vehicle transition and anything that has potential to make electric vehicles more expensive would be, by definition, slightly unhelpful.”

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