A car conundrum.

Discussion in 'Just Talk' started by Allsorts, Jul 18, 2018.

  1. btiw2

    btiw2 Screwfix Select

    No. I know what it is.

    I can’t join the dots in your thinking on how this helps achieve no change to automotive trade with Europe and hard Brexit.

    The question becomes can we only do as well as SK and Japan (but not as well as we currently are)? That’s not good.

    MFN stops us trading as we do (unless the EU makes the same arrangements with those other FTA countries).

    If this were something other than cars, then I might understand, but we sell a lot of cars to Europe.

    Is there a paper or something that explains this (I mean a real paper, not a newspaper!).
     
  2. fillyboy

    fillyboy Screwfix Select

    I never thought there would be a change, other than possibly a minimal tariff, say 2%., it's the remain camp who ae predicting unlikely outcomes, as DA did in his first post with the loss of 800,000 jobs. The MFN rules should protect us from 'punishing' tarrifs, Japan joining a FTA with the EU, and having a manufacturing base in the UK gives them a vested interest also, did they really sign an FTA with the EU not knowing what our future is, given the size of there UK manufacturing base? maybe I'm wrong and they'll all shut their factories tomorrow and move them to Germany, I somehow doubt it.

    The world order is going through a change, I stopped buying Bosch tools ten years ago because in my opinion Makita were at the time better quality and 20% cheaper, I've just bought mrs filly a Hyundai, she drove a vw equivalent and thought it was garbage, the Hyundai was 20% cheaper. Now were paying something like a 8% tariff on the Japanese and Korean goods and their still 20% cheaper than the german equivalent (and most bosch tools are now made in china, as are Makita).
    We're being mugged off in the form of globalism, with a hint of protectionism just to keep the germans and french happy.
     
  3. joinerjohn1

    joinerjohn1 Screwfix Select

    Chust knew an old cove like you couldn’t stay away DA. ( obviously not learnt any lessons though,,, have you )
     
  4. btiw2

    btiw2 Screwfix Select

    But MFN rules mean that the EU can't offer 2% tariffs to the UK on cars - not without without offering the same to SK, Japan and Canada. Isn't that the exact point of the MFN rule you wanted to discuss?
    I think it's fair to assume that if we have a hard Brexit we could still negotiate a MFN status with Europe too. But that's not an open market, and the more MFNs the EU has, the harder it becomes for them to agree to lowering tariffs on us (because they'd have to do it for others too).
    So we probably can get 10%, but not lower than 10% (I looked it up. 10% is the MFN tariff on cars. It's closer to 3% on components [depends on the component]). This is because of the MFN rule you wanted to bring into the discussion.

    I completely agree that tariffs are not the only thing that determines price. If our currency doesn't improve (also I sincerely hope it does) then maybe we can absorb that. But then why bring it up?

    Surely nobody thinks that just because we leave the EU rules won't apply to us. It'll just be different rules. Rules which our companies haven't evolved for. Better rules? Maybe. Make a case, I'd love to read it.

    Understanding international free trade agreements isn't exactly one of my core skills! I think it's fair to say that's probably true for everyone here. So I'm happy for you to point out my mistakes, or perhaps there's a chain of consequences that you wanted to extend (MFN means, but that then means... which will lead to....).

    I have no idea why Japanese firms did what they did. Perhaps they were privately told we would find a way to stay in the open market? Perhaps a company director was on the sake? Who knows? Would it be the first time a car company's board did something dumb?

    But this seems irrelevant to Allsort's point. He wasn't saying that tariffs will make our exports more expensive (I suppose MFN is relevant to that - but not in way that I can see helps the case for hard Brexit).
    As I understand it, AS was talking about integrated supply chains, rules of origin and the importance of the car industry in our economy (I'm still sceptical of that number, I'll look it up later).
     
  5. Allsorts

    Allsorts Super Member

    You are about to earn a thread all about yourself, jj.
     
  6. Allsorts

    Allsorts Super Member

    I made no claims about job losses or anything else - I am not informed enough about the possible consequences. All I did was to start a thread about a topic I'd read a few weeks back - and since posted the link to. I thought it would be interesting to have a look at a specific rather than the more general consequences of a Brexit.

    It was 'food for thought' since it's clear some thinking on here is badly in need of a feed.

    What I found interesting about it is that this car-part trade doesn't come in to the usual negotiations over taxes and tariffs and free trade and customs and all that stuff; it is a very simple 'EU cars can only be built using at least 55% of EU-manufactured components. Regardless of the type of Brexit, the UK will no longer be in the EU so their parts won't count.'

    It makes complete sense to me that if the ex-EU UK-supplied components would bring the %-age of a vehicle build down to below 55%, then the EU would have to look within its union for these parts instead; they would otherwise need to completely revise these rules, and why on earth would they do that?!

    If this were a Frexit or an Itexit or a Spanexit or a Gerexit, one would expect - hope - that the UK, for one, would rub its hands together and say "Ok, that country's exit will hurt the EU, but just look at the opportunities in - for example - car part manufacturing for us! Lads, get ready to boost production..."

    According to that report the Dutch government, for one, is apparently suggesting just that - sensible move, and completely to be expected.

    The 800k figure refers to, I presume, the entire car-part manufacturing industry in the UK. It's pretty obvious that not all these jobs are going to go; I merely asked 'what could happen to them?' (So, stop it, you silly & pernicious u-s).

    As for why Japanese car companies are still investing - or suggesting that they still will - in the UK, that does seem a bit crazy until you recall that May made a very fundamental promise to Nissan; 'whatever happens with Brexit, you will not lose out'.

    That is some guarantee.


    I also made this thread so I could read the likes of Fillyboy's "I never thought there would be a change...", Longbota with "If any of that information is accurate you're probably extremely ignorant", Isit with "Toyota must have misunderstood the situation...", and Long's coup de ungraciousness "He is clearly a numpty of the worst kind. I'm offended by his numptiness. He should be ashamed of himself."
     
    Last edited: Jul 19, 2018
  7. joinerjohn1

    joinerjohn1 Screwfix Select

    I’ve never been on an enforced holiday from SF,, not once mate. ;);)
     
  8. btiw2

    btiw2 Screwfix Select

    The rules of origin are hellishly complex because of global supply chains. Even at the component level, when it a bolt European? The different ores coming from different countries? Their processing? The machining? The putting them in boxes?! What about where boxes were printed? Don't worry. There are rules. Lots and lots of rules.

    But this was all acknowledged by Brexit's star (by default) economist Minford back in 2012. He highlighted that our with car industry, we might have to "run it down" (I wonder if that pun was intended).

    Professor Minford: The car industry is highly integrated, so it would be in the interests of those German dominant manufacturers to negotiate an arrangement, since they have a lot of plants here. There is a huge cross-ownership within the industry because it has been built up inside a protective wall within the EU. Of course, if there were not a will to do that, we would obviously have to give some compensating payments ourselves to our end of the car industry. We could do that, because we would be gaining from the change in the structure of the economy.

    If, for some reason, there were no willingness by the other countries’ car owners and governments to co-operate in this and there were a faster run-down of our car industry as a result of that lack of co-operation, we would have to compensate them in a way rather like the steel and coal industry. Those were not economic industries. That is a quite good parallel. If you have an industry that is not economic, it is your interests to run it down. Obviously, it would be nice if others would co-operate in parallel in the run-down so that it puts less of a cost on you but if, in the end, you have to do it yourself, you are still better off.

    Minford (in that hearing) expressed that would prefer that we concentrated on banking.

    And it's a logical case. I respect that. There again, I don't work in a car factory.

    I've more time for discussions about re-configuring our economy after Brexit than for dandelion topped buffoons who respond with a blanket "eff business".
     
  9. fillyboy

    fillyboy Screwfix Select

    It's the robots I feel sorry for.
     
  10. chippie244

    chippie244 Super Member

    You're too dull for that jj.
     
    Allsorts likes this.
  11. HarDeBloodyHarHar

    HarDeBloodyHarHar Active Member

    Just to emphasise one more time how/why people voted.....
    i see now that a new law from the EU may require drivers to pass new tests to be able to drive vehicles for up to 16 passengers, whereas before, anyone with a full driving licence could do that already.
     
    btiw2 likes this.
  12. chippie244

    chippie244 Super Member

    I think that's a good thing.

    My licence allows me to drive a 7 1/2 tonner with a trailer on a draw bar, I can barely parallel park nowadays.
     
  13. btiw2

    btiw2 Screwfix Select

    It might be a good thing, but doesn’t Hdhh’s point stand?

    There was the perception amongst some people that the EU was limiting their freedom. It was an influencing factor. I suspect many more people get upset about being told that they can no longer drive a small bus, than ever really wanted to drive a small bus.

    Blaming the EU also gave cover to British politicians who probably secretly thought these things were good ideas too.

    And it’s a reason for voting leave that doesn’t mention immigrants or abuse numbers. I like it.
     
  14. chippie244

    chippie244 Super Member

    Blaming the EU for rules that Parliament has brought in is a very old trick that old Dick's have fallen for for ages and still do.

    HA blames them for peanut bags saying "May contain nuts" whereas I just blame your usual office whalla.
     
  15. joinerjohn1

    joinerjohn1 Screwfix Select

    Tell me all laws parliament have brought in , in the last ten years , that have not been directly influenced by the EU.
     
  16. Allsorts

    Allsorts Super Member

    In the scheme of things, I really don't think so.

    Anyways, it's not quite true - as I can attest as a regular 17-seat minibus driver. I have my D1 (as I'm old enough...) but many of the younger volunteers don't. They can still drive the 'bus provided it doesn't have a trailer.

    (It needs to be below a certain vehicle weight, and be capable of catering for disabled passengers).

    Personally, I'm far more happy to allow the EU to keep tweaking these safety measures for the benefit of all than to entrust a newly-free and completely desperate UK who would bend over and drop their pants in public if it meant a slightly better deal from anyone.
     
  17. Allsorts

    Allsorts Super Member

    A bit lazy, jj - you do this.

    And then you might have a point.
     
  18. chippie244

    chippie244 Super Member

    Why don't you try and tell me the ones that have.
     
  19. Allsorts

    Allsorts Super Member

    Yes, jj - add some meat to your gristle.

    Rather than a "Tell me...", try and make an actual point using actual examples.

    You seem to be implying that there's lots and it's all very important to you, so I guess they must be there sitting on the tip of your tongue? So, regurgitate straight from yer 'ead - no surfing, now... :rolleyes:
     
  20. joinerjohn1

    joinerjohn1 Screwfix Select

    I asked first chip, so I’ll let you do the business, ( same reply to your sidekick Bertie Bassett ) ;)
     

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