Brexit: Michel Barnier told plans to police trade could hit companies on both sides of Channel

European car and food manufacturers have warned Michel Barnier that his proposals for policing trade between the EU and the UK could damage companies on both sides of the Channel.

Major trade bodies are urging the EU's chief Brexit negotiator to soften demands that would see tariffs placed on many vehicles and food items because the proportion of parts or ingredients obtained from abroad exceeds certain thresholds.

The move came as a Government source warned that ongoing intensive talks had failed to yield "as much as we'd hoped" so far, warning that the EU "can't expect us to agree to a treaty under which we can't move away from EU norms in important areas".

On Saturday, Boris Johnson held a telephone conversation with Ursula von der Leyen, the European Commission president, to "take stock" of the talks on a post-Brexit trade deal.

Mr Barnier is travelling to London on Sunday to resume talks with Lord Frost, his British counterpart, on Monday after Mr Johnson and Mrs von der Leyen agreed to "redouble efforts".

One of the sticking points is understood to be the EU's proposals for assessing which goods would qualify for tariff-free access to the bloc.

In a letter to Mr Barnier, dated October 19, the European Automobile Manufacturers Association suggested the EU's "rule of origin" proposals broke from "standard rules" in trade agreements and would have "negative consequences" for European car manufacturers.

The UK has proposed a system under which manufacturers would be able count or "cumulate" foreign-derived parts or ingredients as "local" when they export goods such as cars or food items to the EU. However, the EU has been insisting on stipulating minimum levels of "local content" in manufactured goods that would be required for different products to qualify for zero tariffs.

In their letter to Mr Barnier, European car firms said that the current thresholds proposed by the commission would place significant "burdens" on car exporters.

The European Automobile Manufacturers Association singled out the EU's demands for car battery packs to contain no more than 56 per cent of "non-originating" material despite the current proportion of European parts amounting to around 20 per cent.

"Alternatives must be considered," the letter said. "It is critical to ensure that motor vehicle exporters are not burdened by substantial tariffs on trade with the UK when there is no EU battery interests that would be compromised by a flexible approach."

Separately, a coalition of food and drink firms, including the Association of Chocolate, Biscuit and Confectionery Industries of Europe, wrote to Mr Barnier and Lord Frost, warning: "An area of real concern that is shared by food and drink businesses on both sides is around the damaging impacts rules of origin could have for our highly integrated supply chains.

"A tariff-free preferential trade agreement will be meaningless if businesses are unable to access these preferential tariff rates. In the case of food and drink, this will only be possible if both sides agree to put in place bespoke rules of origin."

Manufacturers pointed out that firms in the EU and UK depend on importing ingredients from abroad in order to provide fresh products all year round – for example by obtaining durum wheat from Canada, the US and other countries.

On Saturday, Number 10 said disagreement over fishing rights and  the EU's demands for the UK to observe a "level playing field" of rules and regulations remained major stumbling blocks.

A Government source said: "We still need more realism from the EU. They don't seem to have realised the scale of change in fishing rights they face if there is no agreement."