BMW joins Airbus in Brexit warning

BMW makes the Mini and Rolls Royce and employs about 8,000 people in Britain Earlier, Airbus, which employs 14,000 people in the UK, warned it could leave if the UK exits the single market and customs union with no transition deal.

By: | Updated: June 25, 2018 10:47 AM

bmw, carmaker bmw, brexit, airbus

Car giant BMW has followed plane-maker Airbus in warning about the consequences of Brexit uncertainty. BMW UK boss Ian Robertson has said clarity is needed by the end of the summer, BBC reported on Friday. BMW makes the Mini and Rolls Royce and employs about 8,000 people in Britain Earlier, Airbus, which employs 14,000 people in the UK, warned it could leave if the UK exits the single market and customs union with no transition deal.

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The British government says it is confident of getting a good deal for the industry. The customs union brings together the EU's 28 members in a duty-free area, in which they pay the same rate of duty on non-EU goods. Prime Minister Theresa May has ruled out staying in the customs union. The UK is due to leave the EU on March 29, 2019.

Airbus's decision to warn that future investment in their operations in the UK is under review, while not exactly welcome, is therefore considered by some in government as an honest and helpful declaration of what's at stake for UK workers and the wider economy.

Prominent Brexit supporter Sir Bernard Jenkin described Airbus's comments as the kind of "speculation" seen before, during and after the referendum from large companies.But Airbus's UK boss, Katherine Bennett, told the BBC: "This is not project fear, this is dawning reality."

Robertson said he needed to know what the government's preferred position was 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 making the UK less competitive than it is in a very competitive world right now," he said.

"That is a decisive issue that ultimately could damage this industry."

BMW has previously warned about the damage of Brexit uncertainty, and in May chief executive Harald Krueger said the company had to remain "flexible" about production facilities.

The company has built up an alternative manufacturing base in the Netherlands amid concerns about Britain's suitability as an export hub after Brexit.

Airbus, in its Brexit "risk assessment" published on Thursday, said if the UK left the EU next year without a deal - meaning it left both the single market and customs union immediately and without any agreed transition - it would "lead to severe disruption and interruption of UK production".

The European plane-maker said the warning was not part of "project fear", but was a "dawning reality".

Transport Secretary Chris Grayling said any warning from any major company was taken seriously, but stressed that "we genuinely expect to have a sensible partnership" with the EU that was mutually beneficial.

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