No-deal Brexit threatens motor industry business model
The European Automobile Manufacturers Association has warned that a no-deal Brexit would threaten the business models of Europe’s vehicle makers.
It said: “All manufacturers rely on ‘just-in-time’ and ‘just-in-sequence’ delivery and production, without any delays or obstacles. These parts are in constant transit in trucks, arriving as and when they are needed.
“Every day 1,100 EU trucks cross the Channel to deliver to car and engine plants in the United Kingdom alone, for example. After Brexit, even short hold-ups at customs will cause massive logistical problems, disrupting the production process and generating significant costs.
“Our members are already making contingency plans and are looking for warehouse spaces to stockpile parts,” said ACEA secretary general Erik Jonnaert. “However, the space required to stockpile for more than a short time would be absolutely huge – and expensive.”
“Some of our members are also planning a temporary post-Brexit production shutdown. But the harsh fact is that no amount of contingency planning can realistically cover all the gaps left by the UK’s withdrawal from the EU on WTO terms.”