Taking back control? You bet we are and Rejoiners had better not forget it. because money talks

EU Commission backs down on new UK tariffs, as EU economy falters. The Commission is forced to make a screeching handbrake-turn.

10% tariffs supposed to be imposed from Monday now suspended for three years

Just before Christmas the EU Commission was forced into an embarrassing decision to delay tariffs on UK trade in electric vehicles by at least three years. They did so for two major reasons:-

1. The German auto industry refused to accept it, and
2. The EU’s plans for battery production are way behind what was expected

I now provide a summary of the EU Commission’s climbdown.

The EU Commission’s back-pedalling on electric vehicles

• EU’s rules of ‘country of origin’ for parts in cars would have meant tariffs being imposed
• With the German economy in dire straits, German car manufacturers lobbied the EU Commission
• The deadline has been extended by 3 years to 31 Dec 2026
• The decision affects both electric vehicles and batteries
• Facilitates UK-EU tariff-free trade in electric vehicles
• Prevents 10% tariffs being levied from 01 Jan 2024
• The industry expects this will save car manufacturers and consumers up to £4.3 billion

[Sources: EU Commission and №10.]

The deal was signed by Lord David Cameron and Maroš Šefčovič

“Today’s Decision of the Partnership Council will give legal certainty to European operators. In parallel, the EU will provide significant financial support to European producers of sustainable batteries with a view to strengthening production capacity of batteries in the EU. This is a balanced solution that protects the EU’s interests.”

- Maroš Šefčovič, Executive Vice-President for European Green Deal, Interinstitutional Relations and Foresight, 21 Dec 2023.

The innovative and independent UK is attracting investment

The UK’s approach has already attracted record investments in gigafactories and electric vehicle (EV) manufacturing. This includes:-

• £2 billion Nissan-led investment to produce two new electric vehicles in Sunderland
• Tata’s investment of over £4 billion in a new 40 GWh gigafactory
• BMW’s investment of £600 million to build next-generation MINI EVs in Oxford
• Ford’s investment of £380 million in Halewood to make Electric Drive Units
• Stellantis’ £100 million investment in Ellesmere Port for EV van production

How the industry reacted to the news

Mike Hawes, SMMT Chief Executive, said:

“Deferring the rules of origin is a win for motorists, the economy and the environment. Maintaining tariff-free trade in EVs will ensure consumers retain the widest and most affordable choice of models, at a time when we need all drivers to make the switch.”

Lisa Brankin, Chair, Ford Britain, said:

“On behalf of Ford in the UK, I want to thank policymakers in London and Brussels for listening to and engaging with a united automotive industry. Today’s decision to avoid unnecessary tariff costs is a major moment that will protect jobs, support countless investments, and most-importantly help to keep costs down for consumers and businesses on their journey to an all-electric future.”

BMW Group said:

“We welcome the agreement which has been reached between the European Union and the United Kingdom on their Trade and Cooperation Agreement. This planning certainty will allow the BMW Group to enhance its manufacturing and sales footprint in this highly competitive market.”

Whatever readers’ views about ‘the switch’ to electric vehicles — and I have a few opinions the report above is good news for Brexit Britain.

Had this not been negotiated, the UK’s (and the EU’s) automotive manufacturing industry would have been hit with 10% tariffs starting next Monday. All year we have seen German and other EU car manufacturers in the EU press, lobbying hard. In the end, the EU Commission had no alternative.

In effect, the Commission has done a screeching handbrake-turn.

If British people are in any doubt about Germany's dire car industry and how bad it has got not just for electric vehicles, but for petrol and diesel then my testament should suffice to show you how bad it is

I change my car every three years and buy a brand-new car. However, due to covid and not using my old car that much and having just 7,000 miles on it, I decided to keep it for another year The four years were up back in February, so after looking around in January for a new car and what was on the market I settled for the new Volkswagon Tiguan so off I shuffled to the dealership and orderd one, usually when I order a new car I have it within 6 weeks so I fully expected the same wait, as a car that size usually takes 18 days to make, then the usually wait getting it to the UK and the dealership.

So I was surprised after signing the paperwork the salesman suddenly pointed out that I might get it……..wait for it………..by the 1st December. This took me by surprise, so I asked WHY, the answer was we believe they are having problems at the Factory.

1. being in the workforce after COVID

2. getting the material for the technology the car needs to run properly

Ultimately, I took possession of the car at the end of October. It took just two weeks to get from Germany to the UK and then to the dealership.

I tell you all this to show my experience of what is going on in Germany, to wait 10 months for a new car that usually takes just six weeks is unheard of

Sources: EU Commission | №10