BMW has joined plane manufacturer Airbus in warning of the adverse effect of Brexit.
BMW UK boss Ian Robertson has said it needed clarity by the end of the summer. It makes the Mini and Rolls Royce in the UK.
Earlier, aerospace firm Airbus warned it could pull out of the UK with the loss of thousands of jobs in the event of a "no-deal" Brexit.
The firm, which employs 14,000 people at 25 sites across the country, said it would "reconsider its investments in the UK, and its long-term footprint in the country" if Britain crashed out of the single market and customs union without a transition agreement.
Publishing a Brexit "risk assessment" on its website, the firm also called on the Government to extend the planned transition period due to run until December 2020 if a deal is agreed, saying it was too short for the business to reorganise its supply chain.
Mr Robertson said he needed to know what the government's preferred position is on customs and trade within months or his company - and the UK's - competitive position could be harmed.
"If we don't get clarity in the next couple of months we have to start making those contingency plans - which means investing money in systems that we might not need... which means making the UK less competitive than it is in a very competitive world right now," he told the BBC.
He said it was a decisive issue that ultimately could damage his industry.
A customs union is a form of trade agreement between two or more countries.
It means they decide not to impose tariffs (taxes on imports) on each other's goods and agree to impose common external tariffs on goods from countries outside their customs union.
Setting common external tariffs is what distinguishes a customs union from a free trade area.
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