Despite a challenging environment of tariffs, regulatory hurdles, and geopolitical uncertainty, the sector is on track to deliver more than £110 billion in trade for the third consecutive year, shipping vehicles, parts, and components worldwide.

“Despite the most difficult environment in decades, UK Automotive remains a powerhouse of global trade,” said Mike Hawes, SMMT chief executive. “With its unmatched diversity and world-class capability, the sector already trades across the world. Forging closer trading relationships, notably with the EU, and implementing industrial and trade strategies with automotive at their heart will enable us to grow our economy, create thousands of highly skilled jobs, and lead the charge toward net zero.”

Brexit has fundamentally altered trade between the UK and EU, the report notes, with new customs requirements, tariffs, and regulatory barriers adding costs and complexity. Bilateral trade with the EU, still the largest single market for UK vehicles, reached £68.4 billion last year, accounting for nearly 60% of all automotive trade.

The report highlights the rapid growth in electric vehicle (EV) trade. UK exports of battery electric, plug-in hybrid, and hybrid vehicles to the EU are now worth almost £24 billion, a 424% increase since 2019, while EU EV exports to the UK totaled £17.6 billion. Hawes warned that this progress is under threat from unclear rules of origin for batteries and parts due to take effect in 2027.

The SMMT is urging government action to safeguard trade and investment, including clarifying definitions for cathode active materials, monitoring compliance with new EV rules, and rejoining the Pan-Euro Mediterranean (PEM) Convention. It also calls for stronger global relationships, including finalising trade deals with South Korea, Canada, India, and China, and delivering an industrial strategy to support UK vehicle production.

“With half of UK car exports heading to the EU, a closer relationship is critical to protecting jobs, growth, and decarbonisation,” said Hawes. “Ensuring certainty and investment now will allow the sector to continue its global success story.”

The report underscores that while UK Automotive has navigated a turbulent post-Brexit period, targeted government engagement and industrial strategy will be key to maintaining its position as a £115 billion trading hub.

Source: Five years on from Brexit, UK Automotive remains £115bn trading powerhouse - SMMT