In brief
SMMT forecasts a decline in UK vehicle production in 2026, followed by a rise to 752,000 units in 2027, but cautions that EU trade measures could bar Britain‑built cars from the EU market and levy tariffs of up to £1.4 billion. The society calls the upcoming EU‑UK Summit a vital opportunity to protect the 80‑billion‑euro trade relationship.
At the EU‑UK Summit scheduled for later this month, the Society of Motor Manufacturers and Traders (SMMT) said European Union trade measures threaten the projected recovery of British vehicle production next year. The organisation warned that the EU’s “Made in EU” proposals, as currently drafted, could effectively exclude UK‑built cars from the EU market, while stricter rules of origin taking effect in 2027 under the Trade Cooperation Agreement could add tariffs totalling £1.4 billion annually on two‑way electric‑vehicle trade.
SMMT’s independent outlook projects a dip in annual vehicle production this year, before a rebound to 752,000 units in 2027 driven largely by new electric‑vehicle models. It also notes that exports comprised more than three‑quarters of British vehicle production in September, with 57.5 percent of those exports going to the EU.
In a statement, the SMMT said both the potential exclusion of UK cars and the tariff costs would damage the automotive industry on both sides of the Channel. The society described the forthcoming summit as a “vital opportunity to agree pragmatic solutions and safeguard an 80‑billion‑euro trading relationship.”
The organisation also warned that domestic electric‑vehicle sales targets that it called unrealistic were putting manufacturers under acute pressure, eroding profitability and undermining the UK’s attractiveness as an investment destination.
