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U.K. Carmakers Warn of Brexit 'Worst' Case as Production Shrinks

  • Drop led by 14% fall in domestic demand for British-made cars
  • No-deal Brexit would be ‘worst outcome,’ auto lobby chief says

Car production in the U.K. fell 4.1 percent in September, the fifth monthly drop this year, burdened by increasing concerns over Brexit’s impact on consumers and manufacturers.

The September decline, led by a 14 percent drop in domestic demand for British-made vehicles, caused production to fall 2.2 percent to 1.26 million vehicles through the first nine months of 2017, the U.K. Society of Motor Manufacturers and Traders said in a statement. The lack of progress in negotiations over Britain’s pending exit from the European Union is raising alarm in the auto industry, which is dependent on parts from suppliers on the continent.

“Brexit is the greatest challenge of our times, and yet we still don’t have any clarity on what our future relationship with our biggest trading partner will look like,” Mike Hawes, the lobby group’s chief executive, said in the statement. “Leaving the EU with no deal would be the worst outcome for our sector.” 

Toyota Motor Corp. urged officials to lift the “fog” of uncertainty surrounding the talks. The Japanese auto giant, which makes Auris hatchbacks in Burnaston, England, has raised concerns about risks to the plant’s competitiveness if new duties were levied as part of a Brexit divorce settlement.

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