Brexit has delivered another blow to the struggling UK car industry after the EU rejected a crucial UK plan to avoid tariffs on exports.
Ministers had asked for parts brought in from Japan, South Korea or Turkey to be treated as British, to qualify under strict rules-of-origin if a trade agreement is struck.
But, in a letter to car bosses, Britain’s chief Brexit negotiator has admitted he has failed to persuade the EU to accept the proposal – and “obviously cannot insist on it”.
It means exports now face tariffs unless the majority of their value originates from the UK or EU. Typically, the figure is only 44 per cent for a car assembled in this country.
The EU rejected the idea because it saw the UK