A committee of MPs is informed that the company will not be able to meet the provisions of a tariff-free trade deadline and that it should be postponed to aid the industry’s electric vehicle efforts.
Sir Keir Starmer stated that the United Kingdom requires an “improved” Brexit agreement with the European Union after Vauxhall’s parent company warned that the future of UK auto plants was in jeopardy.
In an interview with Ian King Live, the Labour leader stated that his party would seek “a better deal than the one we have” to strengthen the country’s commercial relationship with the bloc.
Stellantis, whose stable of brands also includes Citroen, Fiat, and Peugeot, used a submission to a parliamentary committee’s inquiry on electric vehicle (EV) production to warn it could no longer comply with Brexit trade rules regarding the sourcing of parts.
The corporation said its two-year commitment to Luton and Ellesmere Port plants depended on meeting the strict agreement. Which stipulate that 45% of the value of EVs must originate in the EU or UK by 2024 to qualify for tariff-free trade.
Stellantis demanded that the deadline be extended to 2027. Otherwise, “trade between the United Kingdom and the European Union would be subject to 10 percent tariffs,” it stated.
It continued in its submission to the BEIS committee, “If we source batteries from mainland Europe and China as planned, our UK Stellantis plants will also be at a competitive disadvantage due to the higher logistics costs associated with transporting the batteries from mainland Europe to the United Kingdom.
This poses a threat to our export business and the viability of our manufacturing operations in the United Kingdom.
“To ensure the continued viability of our manufacturing facilities in the United Kingdom. The country must examine its trading arrangements with Europe.”
Sir Keir stated that Labour would seek to renegotiate several aspects of the trade agreement. But reaffirmed that, if elected, his government would not rejoin the EU or the Single Market.
Regarding the trade agreements, he stated, “I don’t believe that many people consider it to be a particularly effective arrangement.
“We were promised a deal that was oven-ready, but what we received was, frankly, half-baked.”
He stated that it was a crucial component of Labour’s economic expansion plans.
The corporation came out as the UK moves to prohibit new diesel and gasoline-powered cars and vans by 2030.
Britishvolt’s insolvency at the start of the year impacted domestic battery manufacture. However, the company was subsequently rescued.
Stellantis CEO Carlos Tavares told Reuters that the British auto sector would be “in trouble” without British batteries.
If the cost of EV manufacturing in the UK becomes uncompetitive and unsustainable operations close,” continued the submission, “manufacturers will not continue to invest and relocate manufacturing operations outside of the UK, as was the case with previously established UK manufacturers like Ford and Mini.
A massive subsidy offered by the U.S. government to manufacturers is a significant impediment to British investment.
Unlike Nissan, Stellantis has no intentions to produce its batteries in this country. The Japanese corporation worries about the UK’s future due to competitive considerations including high energy costs.
This week, Stellantis halted a joint battery plant project in Canada, alleging the Canadian government of breaking a funding commitment.
Jaguar Land Rover has reportedly requested a subsidy from the British government to construct a battery facility.
