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Maruti, Nissan among few companies tense about outcome of Brexit

United Kingdom: Maruti Suzuki and Nissan are among various auto makers, which export passenger cars to Britain as well as European Union. The automobile manufacturing companies are getting tense due to the anticipated outcome of the Brexit voting, despite of Tata owned Jaguar Land Rover (JLR), pitched a vigilant note regarding the outcome.

Nissan, an eminent car manufacturer in India, also export Indian made cars such as Nissan Micra, and Nissan Sunny to Britain, wherein, the company officials are noticing the developing sales trend very sharply. In addition to that, as Maruti just initiated the export of its recently launched Baleno to Britain and various other European nations, the company did not have a massive exposure to the country.

All the companies are considering the situation to be in doldrums and are trying to study the outcome of Britain, moving out of European Union. Jaguar Land Rover, which is driving a supreme part of overall revenues and profits for the parent company, Tata Motors, stated in regard of the law, that it would remain committed towards the customers in European Union. As per the spokesperson of the company "Nothing will change for us, or the automotive industry, Overnight". The official also added “For Jaguar Land Rover, today is just business as usual. We are a British business with a strong manufacturing base in this country, we call Britain home and we remain committed to all our manufacturing sites and investment decisions. Europe is a key strategic market for our business, comprising 20% of global sales, and we remain absolutely committed to our customers in the EU”.

"There will be a significant negotiating period, and we look forward to understanding more about that as details emerge. We look forward to working with the British Government and the automotive sector to ensure that the UK's automotive industry remains as competitive as ever, and that negotiations between the UK Government and the EU will continue to recognise the importance of car manufacturing to the UK and European economies," as stated by the JLR spokesperson.

According to a recent report published by TechSci Research, United Kingdom Tire Market Forecast and Opportunities, 2021’’, United Kingdom comprises of England, Scotland, Wales and Northern Ireland, wherein, England is the largest country in terms of population and land area. England also accounts for the highest number of vehicles in the United Kingdom and contributes more than four-fifth of the total tire demand in the region. Moreover, several leading global automotive OEMs like Nissan, Land Rover, Toyota, Honda, DAF, etc., operate in the United Kingdom, which consequently, creates huge demand for tires in the country.

TechSci Research believes that with Brexit in power, the car manufacturers in India, exporting vehicle to European Union and through European Union to United Kingdom, would now have to export the vehicles in both the regions, separately. An additional import duty by United Kingdom would be applicable on vehicles, the cost of which would likely fall in the hand of end consumers. Consequently, leading to a shrink in the sale of vehicles in UK in coming years, thus, impacting the overall market of tires in the country.

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