Ford joins ranks of UK car makers in warning no-deal Brexit would be damaging to operations, following significant drop in earnings.
21 Aug 2018 | 2724 Views | By Autocar UK
Ford has warned that a £760 million (Rs 6,788 crore) decline in European revenues last year, much of it attributed to the weaker pound pushing down the value of earnings in the UK, could lead the company to take “whatever action is needed” to remain profitable.
The Independent reports that Ford warned ...
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Ford has warned that a £760 million (Rs 6,788 crore) decline in European revenues last year, much of it attributed to the weaker pound pushing down the value of earnings in the UK, could lead the company to take “whatever action is needed” to remain profitable.
The Independent reports that Ford warned of the potentially drastic action amid rising fears of a no-deal Brexit, with ever more UK-based car makers fearing for their businesses with the threat of increased costs.
Other manufacturers that have issued similar warnings include Jaguar Land Rover, parts supplier Unipart and BMW, which have all suggested that a no-deal Brexit could have severe consequences on their UK operations.
In 2017, Ford’s earnings dropped by £760m in Europe, and the brand said £460 million (Rs 4,108 crore) of this was down to the falling value of the pound since the UK’s vote to leave the European Union. Ford has three facilities in the UK; transmissions are made in Halewood, Merseyside petrol engines are put together in Bridgend, Wales, and diesel engines are constructed in Dagenham, Essex.
“If I’m forced to go out because we don’t have the right deal, then we have to close plants here in the UK and it will be very, very sad. This is hypothetical, and I hope it’s an option we never have to go for,” said JLR boss Ralf Speth earlier this year.
Speaking to the Mail on Sunday, McLaren boss and former Ford manufacturing vice-president Mike Flewitt also expressed concerns about post-Brexit automotive logistics, saying: “How will we be able to import components? Export cars? Well, we don’t actually know how to trade with each other under those terms.
“These are genuine fears. The people I feel most sorry for are some of the car companies that came and invested in the UK through the 1980s and 1990s to make Britain their base for trading in Europe.
“If all of a sudden their trading terms change, that whole investment is almost called into question.”