Wissmann: Decision must trigger rethink in Brussels
in VDA, 24-06-2016
“The British vote was close. But now it is more important than ever for Europe to stand together to avoid a possible domino effect. Every possible measure must be undertaken to enable the continued free movement of goods and services between the UK and the other EU countries. And even after leaving, free exchange of goods with the Continent will still be to Britain’s net advantage,” said Matthias Wissmann, President of the German Association of the Automotive Industry (VDA).
Wissmann appealed for restraint: “Even if many ‘experts’ are competing to paint the worst possible scenario – now is the time for calmness,” Wissmann stressed. However, the VDA president expects a “phase of uncertainty” that will be anything but helpful for industry. This applied both to the financial and currency markets and to the impacts on movement of goods and services.
“Brussels must draw the correct conclusions from the vote. Our common Europe must become more attractive to its members. We need more transparency and genuinely better regulation. We also need appropriate distribution of tasks and burdens in the EU,” Wissmann said, adding that attention had to be refocused on the central idea of the single market. Moderation was required for every regulation along with consideration of the issue of Europe’s competitiveness. “The EU must not become a community of constant transfer payments or merely a transfer union,” he underscored.
Wissmann pointed out that the German automotive industry exported more to Britain than to any other country in the world. Last year 810,000 passenger cars built in Germany were exported to the UK. In 2015 the British passenger car market reached a new record volume of 2.6 million new cars. Half of them (1.3 million) bore a German group badge.
“Following British departure from the EU, it will be in nobody’s interest to make the international flow of goods more expensive by erecting customs barriers between Britain and the European continent,” Wissmann stated. The British automotive market depends heavily on imports: 86 percent of new passenger car registrations are of vehicles that are not produced in the UK but instead are imported. A large proportion of them come from EU countries.
At the same time, however, the UK is strong in exports. Out of the almost 1.6 million passenger cars built in Britain in 2015, a good 1.2 million units – i.e. three quarters of them – were destined for export. The main recipients are the other EU states, with just over half of all exported cars (57 percent) going to customers in these countries.
In addition, German vehicle makers produced around 216,000 passenger cars in Britain in 2015 (+11 percent), and so far there has been a year-to-date rise of 9 percent. German automotive companies – including a very large number of suppliers – have around 100 facilities in the UK. Since 2010 their number has increased by 30 percent. “We should do everything we can to ensure that this success story will be continued. Now it is up to Brussels to take action,” Wissmann said.