Could Brexit put the brakes on?

Brexit challenges the ease-of-access between Britain’s automotive manufacturers and its parts suppliers. So, how can automotive manufacturers prepare for the potential turmoil? Chris Johnson, managing director of automotive ball bearing supplier SMB Bearings, explains. Brexit and, to a lesser extent, the decline of diesel are two of the biggest challenges facing the automotive industry right now. The entire automotive industry talks nervously of such disruption, and what impact it may have. The fate of both, lies in the hands of the Government and its opposition. No matter where you stand politically, you’d probably agree that this uncertainty is not where you’d want to place the future of an £82 billion industry. Considering the sector accounts for a whopping 13 per cent overall of the country’s total exports, there’s a lot on the line. The detrimental effects of Brexit on Britain’s automotive industry have been highly publicised. Tariffs could be bad, reputations could dwindle and there is a danger of delays if the deal results in a hard border between the UK and Europe. However, one of the lesser spoken-about problems is the loss of easy access to European suppliers of essential automotive parts. Consider bearings as an example. Depending on the model, there are approximately ten bearings on a car’s steering column, six in the gearbox, and four on the wheels. That’s not to mention the more peripheral bearings, such as those found in the seat adjustment or wing mirrors. But wait, bearings aren’t hard to come by, are they? Automotive manufacturers cannot overlook the specific requirements of bearings for different vehicle applications. Let’s focus on one area — the throttle system. When the driver pushes the accelerator pedal, the throttle opens and air flows into the engine, where it is mixed with fuel and burned. The throttle valve of the throttle system, also called the butterfly valve, relies on a bearing to work effectively and let in the correct amount of air. Finding a bearing that can cope with the extreme high temperatures of the hostile engine environment, and the rapid throttle movements, has proven difficult for some industry professionals. Put simply, not any old bearing will do. Very high levels of vibration put considerable stress and load on bearings, which means some bearings suppliers fail to meet the brief. That said, whether we’re discussing the throttle system, or other areas of a car, it’s clear manufacturers must maintain access to specialist bearing suppliers, or risk delaying the manufacture of entire vehicles. Prior to the outcome of Brexit, automotive manufacturers should find capable and knowledgeable bearing suppliers. These relationships will remain important throughout Brexit negotiations and beyond. Automotive professionals need to focus their buying efforts on companies that have considered the impact of Brexit. Take our company for example. While we are based in the UK, SMB Bearings relies on exporting for around 60 per cent of its business, 40 per cent of which is within the EU. As a result, the company is currently implementing changes to prepare for the potential outcome of Brexit. To prepare for this change, SMB Bearings is undergoing examinations to achieve Authorised Economic Operator for Customs (AEOC) status. The certification allows us to import and export more efficiently by ensuring our supply chain is secure and that our customer procedures are compliant. The quality mark is beneficial in itself, but could prove to be even more valuable depending on the outcome of Britain’s Brexit deal. Currently, exporters like ourselves have no idea how detrimental Brexit will be on our business — and automotive manufacturers should be taking similar precautions. Will bearings become a hard-to-find commodity amid the aftermath of Brexit deals? Probably not. But in order to ensure reliable supply of high quality, appropriate bearings, industry professionals should choose a bearing supplier that has proactively protected its business and relationships with EU customers.