IT was the result car makers didn’t want – and are now having to come to terms with.
The Brexit verdict came against the wishes of many leading players in the automotive industry, with a statement issued by the SMMT three days before the referendum saying that staying in the European was ‘critical’ to the future of the UK automotive industry.
Senior figures at companies such as Toyota, Jaguar Land Rover and BMW came out firmly in favour of a ‘Remain’ vote.
Ken Gregor, chief financial officer of Jaguar Land Rover, said the company’s European supply chain had been ‘fundamental in helping us to meet customer expectations worldwide and achieve sustainable, profitable growth’.
So a few days later – and now we’re on ‘the other side’ – how are things looking?
Well, one positive sign is that Aston Martin has restated its commitment to build a new £200m plant in South Wales, although CEO Andy Palmer warned yesterday that the carmaker will need to make extra ‘productivity and efficiency’ savings.
And today, Rolls-Royce has reaffirmed its commitment to the UK, but warned that longer-term assurances would depend on the nature of any post-Brexit deal.
The jet, engine and car maker said that the result was ‘not the outcome the company would have chosen’, but added that it ‘remains committed’ to Britain, where it employs 23,000 people, many at its West Sussex base where more than 1,400 workers create up to 20 cars every day.
‘The UK’s decision will have no immediate impact on our day-to-day business,’ the company said. ‘The medium and long-term effect will depend upon the relationships that are established between the UK, the EU and the rest of the world over the coming years.’
Analysts have not been slow to look at the prospects for other manufacturers.
PSA Peugeot Citroen’s UK sales are said to be among the most vulnerable, because the company lacks any UK production to offset the revenue it will lose because of the decline in the value of sterling.
The French carmaker said it would probably be forced to raise prices – not good news for any company hoping to maintain its sales levels.
Of the Asian carmakers, Nissan is among the most exposed through its huge Sunderland factory plant serving Europe and beyond, reported Reuters. The company told the news organisation it had nothing to add to chief executive Carlos Ghosn’s recent warning that a leave vote could hit investment.
Jaguar Land Rover said ‘nothing will change for us or the automotive industry overnight’.
But the Indian-owned firm fears Brexit will wipe £1bn from annual profit within a few years, sources told Reuters.
In other developments, Business Secretary Sajid Javid was today chairing the first meeting of business leaders since the EU referendum result.
The event was being attended by the UK’s leading trade associations, plus representatives of some of our largest sectors, including aerospace, defence – and automotive.
Javid said: ‘I, along with most business leaders, wanted the UK to remain in the European Union. But a clear majority of the country has voted to leave – the people have given the Government their instructions and it is our duty to carry them out.’
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