When Brits say “we don’t make anything here anymore” they forget about the car industry.
Fuelled by PPI payouts (yes, those annoying adverts have actually had an economic benefit) and the availability of consumer credit, Britain’s car industry has enjoyed a half decade of impressive growth.
Consumers are worried. They’re nervous about the economy and their personal finances: wages haven’t gone up nearly as fast as prices. Sales also haven’t been helped by the UK’s plan to ban all non-electric cars by 2040.
There’s also Brexit.
The industry argued fervently throughout the referendum campaign to remain in the EU. It was certain that it needed to maintain its close relationship with key export markets in the EU. The fear that this tariff-free access could now be lost is beginning to worry car makers and threatens future investment. Although companies like Nissan and Jaguar Land Rover have made significant UK investments so are unlikely to pack their bags right away, consider those lower down the supply chain. Like the rest of the sector, they will have to engage advisers to help plan for the potential outcomes of Brexit. And advisers are expensive. So we may start to see an exodus of these smaller firms who’d rather not risk these expenses and further investment that the bigger manufacturers can.
The only thing certain now is the uncertainty that plagues the UK car industry.