The European Union, EU, is a corporation that involves the political and also economic views of the community of Europe; the EU is responsible for making active deals with other countries. 

Recently there was a trade deal made almost a year ago, which was labeled as the credit car dealership. This pact that was made between the EU and the UK was not entirely sweet, and it did indicate the UK leaving the EU but after a transitioning period. 

This deal was bitter-sweet for the industry, but the car industry, if the UK was hurt the most by this, let us tell you how. 

How the car industry of the UK is damaged by the deal 

The tariffs

A tariff is a particular tax paid on imports and exports. This deal has altered a lot in the tax margin; now people would have to pay a 10% tax when buying or selling any vehicle overseas. The tariff is also applicable at the rate of 4.5% if parts are going overseas; this sum is a lot. 

The costs of the cars will ultimately go higher with still less profit for the manufacturers; the economic turbulence would damage the UK vehicle market in drastic ways. 

Disrupted supplies

You see, the UK and EU had a strong bond when it came to the vehicle industry because they had the feasibility of getting parts here and there without any tariff, this encouraged the supply or car and parts. 

Now that the deal would be implemented, we are sure that the supply would be somehow blocked. 

JIT issues

Every minute is crucial for the vehicle manufacturers; a minute delay in car parts could cost a lot annually. Firstly, when the parts were sent to the UK from the EU, there was no tariff, no checking or inspection on large orders. 

But now Honda has estimated a 15-minute delay when it comes to parts; this would cost the manufacturers a lot. 

A European market would be lost

Let’s be real here, did you know that almost 30% of UK manufactured cars were sold in European countries, but with this pact and the higher tariff rates, Europeans have wished they would use locally made vehicles. 

This would result in a more significant downfall in the vehicle industry than ever. 

So, what does all of this mean? 

Well, we regret to say, but this seems like the beginning of the end for the vehicle industry of the UK, this is because all the factors which make a vehicle industry successful are getting affected by this pact. 

There are no hopes of light overall whatsoever; all the vehicle industry could do is wait and watch them falling unless any other country comes in as a savior. 

Conclusion:

There had been a recent disruption in the deal; the EU has filed a legal case against the UK for breaching the agreement. 

A simple man can only see things getting disrupted from this moment ahead.