Election result brings initial stability to UK automotive market
16 December 2019
16 December 2019
Boris Johnson’s gamble on a Christmas election has paid off, as the Conservative party secured a majority of almost 80 seats, leaving the main opposition party – Labour – far behind.
The initial reaction of the stock and money markets was to respond positively to the election results. The main reason being that while a no-deal Brexit risk remains, it is now very unlikely. With a majority government in place, there is more chance of securing some form of regulatory alignment with the EU. Significantly, this means that the likelihood of the UK adopting World Trade Organisation (WTO) tariffs is very low removing the potential of significant price increases across the automotive sector.
The new government has already spoken of building stability for business through both its social and economic policies, a ″one-nation approach″ reflecting diversity and inclusion within the automotive sector. With this goal, the priority for the UK automotive sector is to restore business and economic confidence and to enable the continued journey to reduce emissions on the Road to Zero. These efforts should drive growth in sales of ultra-low emission vehicles and changes to consumer mobility selections.
The UK automotive sector is an economic growth driver in the domestic market and in the rest of the world. This Conservative government needs to maintain our global competitiveness whilst delivering an ambitious deal with the EU to maintain free and frictionless trade, according to Anthony Machin, head of content and product at Glass’s (Autovista Group).
Might there finally be an injection of stability following years of political wrangling resulting from the Brexit referendum? The UK now has a government with a mandate to govern for a full term of five years and a political majority with the power to get policy approved in the House of Commons.