Prime minister Rishi Sunak has said the UK government is in conversation with the European Union regarding new “rules of origin” tariffs, which have been criticised by Stellantis, Ford and JLR.
Stellantis was the first of the three car makers to urge the government to renegotiate part of its Brexit deal with the EU to delay the new rules, which add tariffs to car exports.
The fourth biggest car maker worldwide, which owns Vauxhall, Peugeot, Citroën and Fiat, among other key brands, said earlier this week that it couldn't follow parts-sourcing rules introduced through Brexit.
Updated legislation, which is due to come into force in 2024, means that 45% of the value of an EV produced should come from the EU or the UK to qualify for trade without tariffs. The percentage will increase to 65% in 2027.
Stellantis said the new rules could lead to vehicle factory closures, which would result in the loss of thousands of jobs at Ellesmere Port and Luton.
Speaking to reporters in Japan on Thursday, Sunak said the rule-change deadline was "something that car manufacturers across Europe, not just in the UK, have raised as a concern".
"And as a result of that, we're engaged in a dialogue with the EU about how we might address those concerns when it comes to auto manufacturing more generally," he added.
In an enquiry submitted to the Department for Business, Energy and Industrial Strategy, Stellantis asked for the introduction of the 45% rule to be delayed to 2027.
It also described the rules as “a threat to our export business and the sustainability of our UK manufacturing operations”.
The company said: "If the cost of EV manufacturing in the UK becomes uncompetitive and unsustainable, operations will close."
Ford supported Stellantis’s view, saying the new rules of origin would add “pointless cost to customers wanting to go green”.
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