It is not just engineering which benefits from the free transit of products, parts and components along, often complex, international manufacturing and supply chains. The UK chemicals industry also relies on intermediate products and components being made in a succession of different countries. The import of goods for additional processing and subsequent re-export is common. Trade barriers of any kind – tariffs, duties, quotas, delays, bureaucracy – would be disastrous.
In particular the UK chemicals sector imports about two thirds of its intermediates from the EU and also feedstocks from the sophisticated chemicals infrastructure of mainland Europe. The tariffs on chemicals could be as high as 6.5% and in a tight industrial market this would be a significant competitive disadvantage.
Non-tariff barriers, however, may be even more damaging. With the UK becoming a third-country, companies could lose their right to self-certificate quality, quantity and specification for goods crossing the Channel. To have to do this on a shipment by shipment basis, possibly at the time and port of entry is certain to lead to delays and these might be lengthy and unpredictable. This is unacceptable in modern manufacturing businesses used to JIT deliveries and reliable supply chains.
Then there is the prospect of delays caused by even the slightest disruption to the transit of the 4.5 million lorries per year using the port of Dover and the Channel Tunnel.
Finally in becoming a third country the UK will lose its crucial rights to access REACH, the EU-wide product computerised chemical registration and production and use control system.
“Registration, Evaluation, Authorisation and Restriction of Chemicals Wikipedia
If the UK becomes detached from REACH it will adversely affect its ability not only to trade in Europe but also in many other countries across the globe.
It would not be surprising if, across the world, but especially within EU27, some companies were not already drawing up plans to mitigate supply chain problems that might arise in post-Brexit Britain.