FRANKFURT -- Germany's automakers warned that uncertainty about future tariffs in the wake of a "hard Brexit" could deter investment in Britain over a number of years, hampering their largest export market.
Every second new car sold in Britain comes from a German-owned brand, and every second car made in the UK is exported to a customer in the European Union, Germany's carmaking lobby VDA said.
"An exit of Great Britain from the [EU's] common market would have significant consequences for the economy on both sides of the channel," VDA president Matthias Wissmann said.
"A hard Brexit would be arduous and expensive. The consequence would be a long phase of insecurity. By the time new contracts have been negotiated, years will pass. This has a deterring effect on investors,"Wissmann said in a statement Wednesday.
In a major speech on Tuesday, Prime Minister Theresa May said Britain would leave the EU's single market - interpreted by some economists as a "hard Brexit." May said Britain could not remain a full member of its tariff-free zone, but would seek unfettered trade with the bloc.
In 2015, the last year for which statistics are available, 810,000 cars made in Germany were sold in Britain, VDA said. Some 57 percent of cars exported from Britain go to the EU, it said.
"That is why the automakers have a large interest in finding solutions which enable intensive trade and preserves the value chain," Wissmann said.
BMW, which builds Mini and Rolls-Royce cars in the UK, on Tuesday urged the British government to ensure that UK's negotiations with the EU result in uncomplicated, tariff-free access to the EU single market.