Investments in the automotive industry in the UK decreased significantly, reported Financial Times, citing data from the organization of manufacturers and car dealers in the UK.
For the first half investments totaled 322 million pounds. The main part comes from one project – a Toyota, whose value reached 240 million pounds. Analysts say the reason for this reduction is imminent exit from the EU.
Decreasing investment in the automotive industry began last year. Data for 2016 show that the UK invested 1.66 billion pounds in projects in the sector, compared to 2.5 billion pounds in 2015. It was somewhat expected that car companies will slow their investments after the vote for Brexit.
It is disturbing that the trend continued in the first months of 2017. If these feelings persist until the end of the year, the investments can be made half of last year.
Expectations are precisely those – manufacturers reported no development of new models in the first six months of the year.
Last year, the British automotive industry enjoyed a real revival, supported by international investment and record sales in Europe and the UK. During 2016 it was produced 1.7 million cars, but in May production decreased by 10%, according to data from the industry. This is the second consecutive month of decline.
Many of the largest manufacturers in the country are thinking more about their future in Britain. BMW for example, commented that it will likely its electric Mini outside the UK, indicating an uncertainty due to Brexit.
Nissan plans to produce two new models in Britain, but expects assurances from the government that their factories will not be affected by the Brexit.
“We can see from our study that investors have concerns about what Brexit may mean for the future and they want greater clarity on corporate taxation and incentives for foreign investors,” said Omar Ali, EY’s financial services leader.
“It’s vital that the Government does all it can to articulate a clear strategy around skills, market access and future trading arrangements to ensure the UK continues to be Europe’s preeminent financial centre for many years to come.”
