The first CAT Conversations panel has taken place, with a discussion on what trade with Europe looks like after Brexit.
“The message articulated on Christmas Eve was ‘we have a deal’. I think the first misunderstanding was that the public took it at face value, and believed that we have free trade” said TMD Friction’s Business Development Director Lawrence Bleasdale during the call.
“Frankly, having a free trade deal does not mean that we have free trade” he added.
One of the major issues under discussion was the problem with parts businesses incurring ‘double’ tariffs. for example if a product manufactured in the Far East is brought into a European warehouse, it will incur a tariff. This charge will be levied again when it comes into the UK – and potentially a third time if the product is sold to a consumer inside the EU, such as the Republic of Ireland.
The impact of extra tariffs and hold ups at customs has meant suppliers are running low on stock. Craig McCracken, Group Factor Manager of Arnold Clark Autoparts said: “We normally carry six weeks’ stock, but recently we’ve upped the stock to twelve weeks. However, we are starting to burn through that now and we have some serious supply issues. Some of the orders recently have only had about a 60 percent pick rate at the suppliers. Other suppliers have been fine and have prepared – but some of them unfortunately waited until the last minute”.
Frank Massey, Founder of ADS Preston said that while he hadn’t experienced any major supply problems so far, but disruption that affected the just-in-time delivery of components could cause him to rethink. “If we get to a situation where we can’t get parts in time, then we will have to start looking at sourcing other parts” he warned.
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