EU and UK Auto Industry Warns of 15 Trillion Won Trade Loss Over 5 Years if No Trade Agreement Reached

[Asia Economy Reporter Jeong Hyunjin] The European Union (EU) and the UK automotive industry have warned that if no agreement is reached during the transition period ending at the end of this year, the automotive industry could suffer trade losses of up to 110 billion euros (approximately 15.4321 trillion KRW).

According to major foreign media on the 13th (local time), the EU and UK automotive industries stated in a joint statement that if no separate agreement is reached during the transition period following Brexit (the UK's withdrawal from the EU) and it ends with the imposition of tariffs, prices could rise and demand could decrease over the next five years, resulting in a reduction of 3 million vehicles in production volume.

They explained that under a No Deal scenario, tariffs of 10% on passenger cars and up to 22% on trucks and vans could be imposed, resulting in losses of 57.7 billion euros for the EU automotive industry and 52.8 billion euros for the UK automotive industry. They expressed concern that, given the estimated production value losses of 100 billion euros suffered by the EU and UK automotive industries this year alone due to the COVID-19 pandemic, the combined impact with Brexit issues would be enormous.

Earlier, after the UK left the EU on January 31, negotiations on future relations including trade and security have been ongoing until the end of this year. Recently, concerns about a breakdown in negotiations have increased as the UK introduced the 'Internal Market Bill,' which could partially undermine the existing EU withdrawal agreement.

In the first half of this year, new passenger car registrations in the EU decreased by 38% compared to the same period last year, while the UK saw a 49% decline.

This content was produced with the assistance of AI translation services.