No-Deal Brexit could put thousands onto car prices, MPs told

A NO-Deal Brexit would put four figures onto the cost of buying a car in the UK, MPs have been told.

Delays at ports could cost the motor industry £50,000 a minute, the Commons Business Committee heard.

And consumers would be left paying that price, it is claimed.

In recent years UK factories have produced up to 1.6 million vehicles a year.

But Lloyd Mulkerrins, of the Society of Motor Manufacturers and Traders, warns production could fall to 800,000 units a year if tariffs are imposed, meaning prices will rise.

He told MPs: “Indeed they go even lower over the next consecutive years to potentially 600,000 units produced here.

“It would cost the industry almost £50 billion between the UK and the EU over the lifetime of this parliament in a no-deal scenario.

“We would see costs go up for UK-produced vehicles sold into the EU — roughly £3000 on a car, £2000 on a van.

“And, indeed, on import we would see consumer prices go up for those who want to buy cars here of roughly £1800 for a car or van as well.”

Asked how much vehicle sales to the EU would drop with the introduction of tariffs in a no-deal scenario, Mulkerrins said: “We have had some independent forecasters look at this and we would be in the ball park of sub-1m UK-produced vehicles if there were tariffs applied on the bilateral exchange of goods between the UK and the EU as well.”

Mulkerrins said any port delays would hit the motor industry hard: “Starting on the cost of border delays, we have got to remember that as an industry we are competing against other countries.

“Border delays could cost the industry up to £50,000 a minute. Which translates into about £70m a day for the industry.

“In the worst-case scenario what we would see is, actually, parts not arriving on time to the production site if stockpiles have been used as well.

“Now you can’t produce cars if you haven’t got all the parts.

“So therefore, manufacturers may be in a position where they have to stop production if they can’t get the supplies of key parts and components as well.”

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