An expert on Britain’s automotive industry is predicting a slump in new car sales in the UK in the wake of last week’s Brexit vote.
“The automotive industry is anticipated to be one of the sectors most impacted by the vote to leave the EU,” said John Leech, head of automotive at accountants KPMG. “In recent months we have seen some industry commentators believe that UK new car sales could top 3 million in the coming years. The vote to leave the EU means that this has become highly unlikely and I now forecast that new car sales will fall to 2.5 million cars in 2017.”
But Leech still anticipates that UK car production will grow by double digits in 2016 to 1.7 million cars driven principally by EU exports buoyed by the weak pound.
Leech’s advice for the automotive industry to counter the ill effects of the Brexit? “The fall in Sterling and commodity prices will prompt vehicle production plans, sales incentives, financing arrangements and purchasing plans to be adjusted,” he said. “Information about employees, procurement and distribution needs to be gathered and reassessed such that quick action can be taken once the anticipated changes to VAT, customs and migration rules are enacted.”
