LONDON -- One in three British auto companies operas is cutting jobs as Brexit nears, up from one in eight just under a year ago, according to a survey conducted by a group representing the industry which risks being a big loser from Brexit.
Some 80 percent of companies feared leaving the European Union would hurt their future prospects and nearly two-thirds said they would be unable to invest in their British operations, the Society of Motor Manufacturers and Traders (SMMT) survey showed.
"Make no mistake, every day 'no deal' remains a possibility is another day of lost investment, another day that makes it harder to recover investor confidence in the UK," SMMT CEO Mike Hawes said.
"As yet, the damage is not irreversible. But we need a deal. A deal that, in the short term, enables a 'business-as-usual' transition for as long as it takes to negotiate and implement the future trading relationship," Hawes said.
In the longer term, the industry needed frictionless trade with the EU, he said.
The SMMT said its survey was based on responses from 158 member companies polled in September.
Prime Minister Boris Johnson has said he is prepared to take Britain out of the EU without an agreement on Oct. 31 if necessary, although lawmakers have passed legislation that they say will force him to seek a delay from Brussels.
The autos sector, Britain's biggest exporter of goods, is concerned that World Trade Organization tariffs of 10 percent on vehicles alongside new customs checks and border delays could halt production if there is a disorderly Brexit.
Export tariffs would make locally built autos uncompetitive when sold in mainland Europe, and customs checks and red tape would disrupt ultra-efficient, just-in-time supply lines, carmakers say.
Margins are already wafer thin and many manufacturers will not survive the application of tariffs, SMMT said, adding that the cost of a ‘no-deal’ Brexit would be 50,000 pounds a minute.
Last week, Nissan said its plant in Sunderland, Britain's biggest car factory, would be unviable if Brexit triggers tariffs. The plant sends 70 percent of its output to the EU
The European Union’s chief Brexit negotiator, Michel Barnier, has said a deal is possible this week -- but talks remain tough.
Bloomberg contributed to this report
