UK exclusion from EU 'Made in Europe' plan risks British auto trade, lobby says

Sept 22 (Reuters) - Britain's exclusion from the European Union's proposed "Made in Europe" provisions puts the British automotive industry at a competitive disadvantage and threatens its contribution to the EU's economy, a trade group said on Tuesday.

The current draft would deny future British-built vehicles incentives available to EU-built products, including support for greener corporate fleets and CO2 super credits, the Society of Motor Manufacturers and Traders said.

The policy also excludes British vehicles from EU member state procurement, meaning contracts awarded by public bodies in the EU.

The SMMT said the provisions highlighted the scale of EU-Britain interdependency in the automotive sector, as the EU debates the Industrial Accelerator Act, which aims to drive automotive manufacturing in Europe and reduce dependence on China.

"Despite Brexit, supply chains remain deeply integrated and the cross-Channel trading relationship is worth €80 billion a year," said SMMT Chief Executive Mike Hawes.

"Excluding the UK from "Made in Europe" would be an own goal, weakening competitiveness, reducing scale and limiting consumer choice," Hawes said.

The car lobby said such regulations put British production at a competitive disadvantage in its largest market, with Britain the EU's largest export market for passenger cars and the EU Britain's largest export market for passenger cars.

Falling demand for UK vehicles would in turn affect the EU, as the UK is the EU's largest customer for automotive components, SMMT said.

(Reporting by Simone Lobo in Bengaluru; Editing by Tasim Zahid)