Thread by @pmdfoster, Today in a leaked letter Lord Frost concedes that EU will not [...]

Today in a leaked letter Lord Frost concedes that EU will not give UK preferential trade terms to UK cars...but that is not what @BorisJohnson
promised on 2019 election trail. So does that matter? 1/thread #comments-anchor">https://www.ft.com/content/4fa4732b-877b-4994-bfc4-c8ae1cd80a78 #comments-anchor">https://www.ft.com/content/4...

EU won’t grant preferential trade terms to UK car industry, admits Frost

Chief Brexit negotiator says Brussels not willing to be flexible on zero-tariff access to bloc

https://www.ft.com/content/4fa4732b-877b-4994-bfc4-c8ae1cd80a78#comments-anchor

First the letter (that was first reported by @faisalislam) which tl;dr says "we asked for preferential terms, the EU said no"....

This relates particularly to so-called & #39;rules of origin& #39; - the need for a car to be 45% UK-made to get 0-tariff access to EU under an FTA/2

The problem, as @Petercampbell1 points out is that companies like Nissan and Toyota use parts from Japan and the EU won& #39;t let those count or "cross-cumulate" as UK-inputs....not that that should come as any surprise. /3

. @MichelBarnier has been banging on for ages about UK not being allowed to be an "assembly hub" off the EU after Brexit...see this speech from Sept 2. /4

https://ec.europa.eu/commission/presscorner/detail/en/statement_20_1553">https://ec.europa.eu/commissio...

But it *might* comes as surprise to UK car workers and voters who were told by @BorisJohnson on the stump that it is "absolutely vital we protect supply chains, we protect Nissan Motors, we make sure people continue to want to invest in our country" /5

https://autovistagroup.com/news-and-insights/uk-election-what-about-automotive-industry">https://autovistagroup.com/news-and-...

Is there a risk that the No 10 machine is underestimating the impact of #brexit on the car industry? And whether voters might feel angry or short changed?

Genuine question - because I bow to them on this stuff; they are masters of the "narrative" and alternative facts /6

So when you see this extraordinary tweet from @Conservatives it& #39;s a similar thing - as many have pointed out UK internal market bill doesn& #39;t "guarantee seamless" trade, au contraire.../7 https://twitter.com/conservatives/status/1311027739911229440?s=21">https://twitter.com/conservat...

https://twitter.com/conservatives/status/1311027739911229440?s=21

Take a read of this report I did this week after @Foodanddrinkfed warned some trade would be "unviable" as a result of regulatory border that& #39;s coming in the Irish Sea.../8 https://www.ft.com/content/c8c1c935-fe16-4c64-8428-b21847007e02">https://www.ft.com/content/c...

Food industry warns on post-Brexit trade with N Ireland

Government urged to provide greater clarity as members weigh costs of regulatory border

https://www.ft.com/content/c8c1c935-fe16-4c64-8428-b21847007e02

This is the @Foodanddrinkfed graphic setting out the new frictions...doesn& #39;t look all that seamless - though the UK Gov hopes that some of this frictions CAN be smoothed away. /9

Everyone is waiting to see the details - not least industry - and the Govt is spending £200m on a trader support service...but companies are still going to be doing a lot of paperwork, which carries time and cost. Whatever it is, it& #39;s not "seamless" /10

That doesn& #39;t mean it cant work - and cross-channel trade in autos will still work because EU and UK will cumulate "bilaterally" - it just might favour EU companies with higher local content percentages. /11

One of the really interesting things is whether - deal or no deal - any of this cuts through; how hard it will land politically, beyond the respective remainer/brexit bubbles. /12

No-one really knows - even affected industry is v cloudy on impacts - but arguably that isn& #39;t helping with clarity of political decision making. Where there is uncertainty it& #39;s always possible to construct political case for sticking to "values" and ignoring economic harms ENDS

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