Auto companies in the UK have downsized their investment due to uncertainty over Brexit negotiations. The country's main car lobby group is urging the government to keep its member status in EU's customs union. 

Auto factories in the UK are less willing to invest. The Society of Motor Manufacturers and Traders said only about 350 million pounds were invested in new plant, machinery and model development in the first half of this year. That's down by half year on year.  The industrial association worries the fall is just the beginning of a full-scale downturn.

MIKE HAWES, CHIEF EXECUTIVE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS "We haven't left Europe yet. The investment decisions we see today are the result of decisions taken three or four years ago. It's the decisions we take now and in the next year, you will see the impact as we go into the 2020s."

A bad Brexit that shuts the country out of the EU custom union could destroy the car manufacturing business as a re-installed border could add significant costs to import parts from EU countries. An average car has about 30,000 parts.

And in BMW's case, the parts used to assemble Mini and Rolls Royce cars are 90-percent dependent on European suppliers. That's why the group's UK operation threatened to close factories.

BMW's Robertson called the government not to give up the industry.

IAN ROBERTSON, MANAGEMENT BOARD MEMBER BMW "We recognize, we understand, we accept that Britain is leaving the European Union. But it doesn't need to leave certain parts of the process of the European Union, regulation being one of them, regulation being one and borders being another. This industry has grown up in, and I mentioned you know, a resurgence to whatever one point six million cars last year produced, a resurgence based on the free flow of materials in and out and a borderless environment. We shouldn't give up on that. We don't need to give up on that."

The cabinet, on the other hand, wants to use the country's deficit with the EU to push for an economically good Brexit.

CHRIS GRAYLING BRITISH TRANSPORT MINISTER "We have a trade deficit with the European Union of I think around 130 billion pounds a year in goods. So we are their biggest, if not their biggest, then certainly their second biggest export market. There are jobs all around Europe that depend on the people in this room, as UK-based consumers. It is in everyone's interests that once we have gone through all the process of negotiation, all the position-taking, it is everybody's interests that we have a sensible trading arrangement for the future."

Auto manufacturing is one of Britain's few industrial successes since 1980s. The sector employs over 800,000 people and generates turnover of 110 billion US dollars. Much of the industry is owned by foreign companies.