How Brexit is Impacting Automotive and Tech Sectors

Editorial Team
Editorial Team
Mixed messages: The impact of Brexit on automotive and tech sectors

We take a look at the automotive and tech sectors following the unprecedented political fallout of Brexit.


Brexit has uncoiled into an unprecedented political mess.

Splintered parties, three years of ongoing EU negotiations, and a prime minister who was only put into power because her predecessor lied to the nation when he said he would not resign in the event of a referendum defeat – these are times quite like no other in the UK.

For business, which above all values stability, there is still little sign of calming waters just yet.

With organisations calling for some degree of certainty regarding the UK’s withdrawal from the European Union, the dismay at the political class’s failure to negotiate and execute a departure appears to be at least one sentiment uniting commerce.

However, the impact of Brexit on numerous industries continues to be cause for impassioned debate. While the true impact of Brexit will never be known until it has happened, this hasn’t prevented a deluge of research being published in attempts to forecast what might be on the horizon.

Here is a look at some of the sentiments coming out of the automotive and technology sectors.


The automotive industry appears to be fairly united in its response to Brexit, the key message being the need to avoid a so called no deal scenario which would see the UK trade with the European Union on World Trade Organization terms (and the introduction of tariffs and possible border check delays).

The Society of Motor Manufacturers and Traders (SMMT) is a prominent trade association representing the interests of around 800 automotive companies.

It has set out a series of priorities geared around securing tariff-free access to European and other global markets, as well as ensuring the industry can continue to recruit the sector’s best talent.

Speaking in response to the most recent extension of Article 50 agreed in March 2019, SMMT Chief Executive Mike Hawes said: “It is utterly unacceptable that, more than two years since negotiations started, industry still does not know what the UK’s relationship with the EU will be in the coming weeks and months. Uncertainty has already caused serious damage – car plants are on enforced shutdown, investment has been cut and jobs lost.

“This cannot go on. Government and parliament must use this extension purposefully to take ‘no deal’ off the table for good, and guarantee a positive long-term resolution that delivers frictionless trade. If they fail, we face yet another devastating ‘no deal’ precipice.”

According to the SMMT, a WTO tariff of 10 percent on imports and exports would combine to cost the UK around £4.5 billion a year. In its view, a Norway-plus-style relationship with the European Union would deliver most of the automotive industry’s priorities.


Unlike the automotive industry, technology businesses present a more mixed impression of Brexit and its potential implications.

Of course, some research shows an equally fearful attitude towards a no deal scenario – for example, a recent techUK study found that 70 percent of respondents said such an outcome would be very negative or fairly negative for their business.

However, there are more positive sentiments emerging from tech circles than most industries.

London Mayor Sadiq Khan, a staunch remain supporter, last year delivered a speech at a Wired Live event that detailed how the city’s tech scene will thrive post-Brexit. In the speech he outlined how the UK capital is emerging as a global fintech and AI hub.

Another study, this time by PwC, found that technology companies are more likely to be positive about Brexit’s impact than organisations from other sectors.

Indeed, 57 percent of tech respondents believe it will have either a very positive or quite positive impact compared to the 41 percent average found across the entire research covering many industries.

Jass Sarai, UK Technology Industry Leader at PwC, commented on the release of the research: “Technology companies are used to facing disruption and are arguably more agile than most and less affected by new barriers to physical trade, so it may come as no surprise that they feel more positive than other industries about their Brexit preparedness.

“As most industries continue their journey to become tech enabled, demand remains high for core technology products and services. Companies in the sector also tend to have more of a global view as they strive for rapid growth.”

In what is an almost impossibly difficult topic to fully grasp and accurately forecast, Brexit has and surely will continue to stir different emotions among businesses in a great many sectors beyond automotive and technology. Until the process is completed, such debates will only continue to rage. 

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