BMW board member Ian Robertson has warned that any future trade agreement between the UK and EU needs to avoid adding bureaucracy and additional admin costs that would be particularly burdensome for small companies further down the industry supply chain. He also told just-auto that the UK auto industry could be disadvantaged by stricter rules of origin that typically apply in WTO bilateral trade deals, should they apply in the future.
Speaking on the sidelines of the FT Future of the Car Summit, Robertson points out that the auto industry is global and has systems and architectures that have been built up by big multi-national companies to serve international sourcing demands. But small companies don’t have that same extensive systems infrastructure.
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“Now, I look at BMW as a company and there’s lots of debate, but some say ‘BMW will be okay [in any future UK-EU trade arrangements] because you can have ‘trusted trader’ status, you can do everything electronically’,” he says. “Fine. And we can, because we do export a lot of stuff around the world. In fact it is 7,000 containers worth every day. It’s a lot.
“But there are small companies in the sector, Tier 3s, 4s and 5s, that have never done customs paperwork. They have never had to. Are they likely to get that same ‘trusted trader’ status? Probably not. So it’s another element that brings a potential cost that at the end of the day, the customer does not see a value to.”
BMW – which has a MINI plant at Oxford amd engine assembly at Hams Hall – will adapt, he maintains. He also says the UK auto manufacturing sector will continue to adhere to common European standards.
“With the customer in mind and given the competitive nature of our business, we have to work on these elements. If something like this [added cost in the supply chain] comes about, we will of course work hard on how we can offset it.
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By GlobalData“I don’t care what we call it, he says. We just want the outcome that says we will continue to enjoy the seamless logistics flow in an environment where we are inevitably going to have common regulations within a European context. Ideally we’d like common regulations for one world, but that’s not going to happen, so let’s settle for Europe, the US and China.”
Robertson want the industry to focus on exciting opportunities and not get distracted by dead cost such as additional bureaucracy.
“There is a lot of political rhetoric right now. We need to reinforce the common sense position of the industry day after day to ensure that we don’t knock the UK industry off course. I say again, this is the most exciting time in this industry for a hundred years.”
