Could Hard-Brexit Kill Off The UK Car Repair Industry?

Mon 11th Mar 2019

Britain’s crash repair industry could be on the brink of bankruptcy if the UK doesn’t negotiate a satisfactory exit from the European Union according leading industry figures.

With more than 3,000 companies and 35,000 employees, the repair industry relies heavily on supply chains for car parts, many of which are imported from outside the UK.

Business Insider has published confidential minutes of a meeting of 17 industry figures in February, which underlines the ‘dire’ consequences for the thousands of companies which require fast delivery of parts to repair cars.

"If the import delays were prolonged - 3 to 4 weeks for example without parts availability, the consequences to our car body repairers could be dire," the minutes state.

By week three, "many repairers would have run out of cash and face closure," and by week four "even repairers with strong balance sheets would be in trouble" while some would have "to raise cash or sell assets to survive."

In an interview with BI, Steve Field, Managing Director of Page Automotive Accident Repair Group, one of the biggest groups in the UK said: "If we cannot receive parts, we cannot repair cars. If we can't repair cars, we can't maintain our cash flow. If we don't have cash coming in, we can't meet expenses going out of the business.

"We have two to three per cent return on sales, that's our profitability. We don't have any cash lying around.

"There are no cash reserves. There is not one public limited company in the repair network. It's all privately owned businesses of varying sizes. Most run using overdrafts."

The UK Government will vote to accept the Withdrawal Agreement on Tuesday, the alternatives are a hard-brexit, or asking the EU for an extension to the withdrawal period.