Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious Outperformance
Find Stocks Now

Ford joins Stellantis in calls for extension of post-Brexit trade rules

Published 05/17/2023, 10:40 AM
Ford (F) joins Stellantis (STLA) in calls for extension of post-Brexit trade rules

American automaker, Ford Motor Company (NYSE:F) on Wednesday called for the post-Brexit EU trade requirements on rules of origin for electric vehicles (EVs) to be delayed until 2027 from 2024, saying tariffs will add pointless costs for consumers and slow the transition to electric.

"Ford is calling for current trade requirements to be extended to 2027, to allow time for the battery supply chain to develop in Europe and to meet EV demand," the U.S. carmaker said in a statement.

"Tariffs will hit both U.K.- and EU-based manufacturers, so it is vital that the U.K. and EU come to the table to agree a solution."

The carmaker's statement follows a similar call by the world’s No. 3 carmaker, Stellantis NV (NYSE:STLA) who warned that British car plants will close with the loss of thousands of jobs unless the Brexit deal is swiftly renegotiated.

Under the trade deal agreed when Britain left the bloc, 45% of the value of an EV being sold in the European Union must come from Britain or the EU from 2024 to avoid tariffs. However, a battery pack can account for up to half a new EV's cost. Batteries are also heavy and expensive to move long distances.

Ford warned that the car industry in the U.K. does not have enough locally-sourced batteries and components to meet demand.

"Tightening the trade rules at this point risks undermining the switch to EVs with tariffs," Ford said. "Manufacturers who have invested heavily early in the transition will be hardest hit by tariffs because combustion engine vehicles will continue to move tariff-free."

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Shares of F and STLA are up 1.54% and 1.48% respectively in early trading on Wednesday.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.