Ola Källenius, speaking in his capacity as president of the European Automobile Manufacturers' Association (ACEA), said excluding the UK would "weaken the industry on both sides". He was speaking weeks before political leaders hope to reach agreement on the Industrial Accelerator Act (IAA), which aims to protect local industry from competition outside the EU, mainly from China, which now enjoys a £1bn a day trade surplus with the bloc.
The act could cause problems for close EU allies including the UK, Norway, Turkey and Switzerland.
"It does not make any sense. We would hurt our industry in the UK and the EU. That would be a deliberate choice to worsen the competitiveness of your own [EU] industry," Källenius said at an annual briefing in Brussels on the state of the car industry. "We are talking about how we industrialise more in Europe, how we build local supply chains, that is what the IAA is all about."
Andy Burnham has been lobbying hard to get the UK included in the legislation but is hitting resistance, particularly from France. The prime minister intends to raise the issue at the UK-EU summit on 20 November, hoping it is not too late, even though EU leaders are aiming for political agreement on the current text by December.
Last month the EU urged the UK to follow the bloc and impose tariffs on imported Chinese vehicles, which the EU introduced in 2024, arguing this would help the UK's case for inclusion as it would align London more closely with Brussels. But the UK business secretary, Jonathan Reynolds, said this was not on the cards.
The ACEA is also lobbying for an urgent suspension of plans to introduce 10% tariffs on UK electric vehicles imported to the EU, and EU EVs exported to the UK, under the post-Brexit Trade and Cooperation Agreement.
"We are getting very anxious about it. The deadline is in less than three months' time. We have our feet to the fire in terms of the tariffs. All our manufacturers are worried," said Jonathan O'Riordan, the ACEA's international trade director.