Toyota, Nissan to ask UK to reimburse costs of exporting to EU

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Japan’s two biggest automakers, Toyota and Nissan, will ask Britain to reimburse them for additional customs fees incurred if the British government fails to secure a Brexit trade deal with the European Union, reported Monday the financial daily Nikkei.

The companies want the payments to cover the additional 10% tax on auto imports from Britain that the EU would impose if Britain leaves the EU without a deal, the Nikkei said, without citing of sources.

Auto makers officials declined to comment on the report, although Nissan expressed concern about the potential impact of a no-deal Brexit on its business.

“We urge UK and EU negotiators to work together for an orderly and balanced Brexit that will continue to encourage mutually beneficial trade,” Nissan said.

British Prime Minister Boris Johnson said on Sunday he was not particularly keen for the Brexit transition period, which runs until the end of the year, to end without

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trade deal in place, but that Britain could live with such a result.

The Nikkei report, however, highlights how disagreement on a new business relationship could cause foreign companies operating in Britain to reconsider the viability of operations in the face of additional tariffs that erode profitability, and customs controls and regulations that slow down operations.

Toyota operates a plant in Derbyshire, central England, and produced around 8% of the 1.52 million cars made in Britain in 2018. It also produces engines at a plant in Wales.

Nissan has a manufacturing plant in Sunderland in the northeast which employs 7,000 people. The plant would be “unsustainable” if Britain left the EU without a trade deal, Nissan said in June.

Nissan said in March that it was moving forward with plans to build its new Qashqai sport utility vehicle in Sunderland. When it first announced the £ 52million (€ 57million) investment in 2016, the automaker said it had obtained assurances from the UK government that Brexit would affect not its competitiveness. – Reuters

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