Airbus SE said it might be forced to move future investments out of the UK in the event of a no-deal divorce from the European Union, slamming the “madness” of Brexit supporters who assume the planemaker won’t abandon Britain.
“If there is a no-deal Brexit, we at Airbus will have to make potentially very harmful decisions for the UK,” said chief executive officer Tom Enders, who has been among the most outspoken business leaders on the topic. “Please don’t listen to the Brexiteers’ madness which asserts that, because we have huge plants here, we will not move and we will always be here. They are wrong.”
The comments, in an unusual video message shared by the company on Thursday, are the strongest yet since the 2016 referendum from the executive who has repeatedly warned of fallout from a worst-case Brexit. They add to pressure on Theresa May, the UK Prime Minister caught in the crossfire between pro-EU members of her Conservative Party who want to postpone the March 29 Brexit deadline and euro sceptics who threaten to bring down her government if she does.
Airbus, based in Toulouse, France, directly employs 14,000 people in the UK and supports another 110,000, Enders said in the video. The company has production sites in Filton, in the southwest of England, and in Wales, where it manufactures wings for its range of commercial aircraft.
Airbus was overtaken in 2018 by its arch-rival, Boeing Co, as the world’s biggest maker of jetliners by orders.
Enders adds to a litany of warnings about a no-deal Brexit from automakers, drug companies and retailers. Financial-services firms have already started relocating staff to the continent.
BMW AG chief executive officer Harald Krueger has said the carmaker would be forced to build in the Netherlands; Toyota Motor Corp warned of a temporary halt in production at its plant in Burnaston, England; and PSA Group, the maker of Peugeot, Citroen and DS vehicles, is considering closing one of its UK factories.
Britain would face a severe hollowing-out of its industrial base if such decisions were taken, yet time is running out for a decision on Brexit. If the UK can’t agree on a deal in the next nine weeks, the country will leave the EU in a disorderly split that British authorities warn will risk a recession.
The pound might weaken as much as 25%.
Parliament is scheduled to vote next week on a series of options for Brexit’s next steps, including a proposal to force the government to ask the EU to extend the deadline. Senior figures in the French and German governments have said they’d be open to agreement on that request, signalling a receding risk of a no-deal Brexit.
“It is a disgrace that more than two years after the result of the 2016 referendum, businesses are still unable to plan properly for the future,” Enders said. “If you are really sure that Brexit is best for Britain, come together and deliver a pragmatic withdrawal agreement.”
While squabbling lawmakers can’t agree on a model for Brexit, many financial firms are moving money out of the City of London, a shift that may be irreversible. Five of the largest banks looking to serve continental European customers intend to send £750bn ($854bn) of assets to Frankfurt.
Airbus has been stockpiling parts at its plants in the UK and Germany to try to blunt any immediate impact of the hard borders that a no-deal Brexit would impose. The company has said that it expects to have enough stock to cover production for one month, but it can’t be fully prepared.
While the scale of Airbus’s plants won’t allow it to immediately vacate the UK, the manufacturer “could be forced to redirect future investments” if Parliament doesn’t avoid a no-deal exit that risks blocking borders, restricting the movement of workers and delaying its just-in-time production line.
“Make no mistake, there are plenty of countries out there who would love to build the wings for Airbus aircraft,” Enders said.
LEAVE A COMMENT Your email address will not be published. Required fields are marked*
IMF begins visit as Lebanon grapples with financial crisis
Qatar’s listed banks post average 5.5% increase in profit, 9.3% jump in assets in 2019: KPMG
Investor concerns mount as virus spreads outside China
China set to cut rates as it battles coronavirus impact
HNA affiliates’ shares rally on China bailout plan news
Coronavirus fears hit Asian markets
New UBS boss brings fintech skills and whiff of Dutch scandal
Electrical tape on sign tricked a Tesla into speeding in a test
‘Ooredoo Qatar to complete deployment of Nokia’s customer engagement solution’