LONDON, May 17 (Reuters) – Ford (F.N) on Wednesday called for post-Brexit EU trade requirements on rules of origin for electric vehicles (EVs) to delayed until 2027 from 2024, saying tariffs will add pointless costs for consumers and slow the transition to electric.
“Ford is calling for current trade requirements to be extended to 2027, to allow time for the battery supply chain to develop in Europe and to meet EV demand,” the U.S. carmaker said in a statement.
“Tariffs will hit both UK- and EU-based manufacturers, so it is vital that the UK and EU come to the table to agree a solution.”
Ford is investing 380 million pounds ($480 million) to build e-motor capacity at an engine plant in the British city of Liverpool, part of electrification plans across Europe.
The carmaker’s statement comes after world No. 3 carmaker Stellantis (STLAM.MI) warned that British car plants will close with the loss of thousands of jobs unless the Brexit deal is swiftly renegotiated.
Under the trade deal agreed when Britain left the bloc, 45% of the value of an EV being sold in the European Union must come from Britain or the EU from 2024 to avoid tariffs.
The problem is that a battery pack can account for up to half a new EV’s cost. Batteries are also heavy and expensive to move long distances.
Ford warned that the car industry in the UK does not have enough locally-sourced batteries and components to meet demand.
“Tightening the trade rules at this point risks undermining the switch to EVs with tariffs,” Ford said. “Manufacturers who have invested heavily early in the transition will be hardest hit by tariffs because combustion engine vehicles will continue to move tariff-free.”
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