(Bloomberg) – Some of Britain's biggest and most reputable manufacturers are calling on lawmakers to avoid a disruption of the European Union with serious warnings: production should stop and political inertia harm their activities.
The luxury car maker, Rolls-Royce, said that its plant located in the south of England could be paralyzed in the event of a hard Brexit if a single component became unavailable due to delays at the border. In the United Kingdom, at Airbus SE, which manufactures wings for all its planes, uncertainty about the nature of Brexit has become "really unbearable" and the costs of planning and preparing contingency plans have increased. has soared to millions of dollars, said Executive Director Tom Enders. said Wednesday night in London.
While there is only 78 days left before the UK leaves the EU in one way or another, the political stalemate continues to haunt the companies that matter on the uninterrupted flow of goods and stability to make investments. Like other car manufacturers, BMW AG's Rolls-Royce operates a "just-in-time" production system, generally storing parts for only 24 hours, creating a risk of blocking the supply chain.
The exit agreement proposed by Prime Minister Theresa May should generally be rejected by lawmakers when it is put to a vote in Parliament next week, leaving the eventuality a Brexit without agreement.
"My call to decision-makers in London: whether you think leaving the European Union is good for the UK or not: stop obstructing this issue, allow an orderly and agreed Brexit and find an agreement with Brussels, "Enders said in the British capital to an audience including the Chancellor of the British Exchequer Philip Hammond.
The Airbus chief said that the money already spent on storing parts represented only a fraction of what the company would incur in the event of a messy divorce.
Rolls-Royce is also preparing for a no-transaction split on March 29 by training suppliers on new import procedures, halting production each year in the first two weeks of April, investing in computer systems and – as its rival Aston Martin – – arrange for certain parts to be flown in if the ports are trapped by customs delays.
Nevertheless, the manufacturer of the $ 325,000 Cullinan sport utility vehicle "super fragile" remains vulnerable, said chairman and CEO Mueller-Oetvoes in London on Wednesday.
"You can plan what you want, but you can not store weeks of parts.If the supply chain broke, it would affect production," he said at a briefing at Mayfair's showroom at Rolls-Royce. "You only need one component and you can not finish the car."
Rolls-Royce supplies 32,000 parts used in its vehicles to more than 600 global suppliers, of which only 8% in the United Kingdom. This requires 35 daily trips in cross-country trucks. The level of personalization offered means that it takes about 800 hours for each car, which increases the risk of disruption.
Other automakers, such as Jaguar Land Rover, have warned that tens of thousands of British jobs would be threatened by a Brexit without agreement. JLR announced Thursday that it would cut 4,500 jobs worldwide, in response to the slowdown in sales already triggered by the 2016 Brexit vote, as well as the declining demand for diesel-powered vehicles and the recession in China.
Meanwhile, Honda Motor Co. has become the last manufacturer to announce that it will stop annual production in the UK in the days following Brexit, according to Sky News. The factory is located in Swindon, West London.
Whatever the circumstances, Rolls-Royce banned the abandonment of production at its Goodwood plant, located near the south coast of England, the British strengths of the brand being at the heart of its appeal to the very rich, said Mueller-Oetvoes.
"It's a non-suit," he said, adding that Rolls-Royce was committing to Britain and that one-third of its customers were going to Goodwood, "sitting with engineers and designers to clarify their dream and see how we build and build things. "
For Airbus too, getting out of the UK is a complex task. The wings are among the most complex components of an aircraft and UK facilities have gained decades of expertise in manufacturing. At the same time, Airbus relies on open borders to ensure logistics and often ships parts or entire wings between the mainland and the United Kingdom with the help of special cargo planes.
Enders, a virulent critic of the UK's plan to leave the EU, has refrained from approving the May deal that awaits a vote in parliament next week. Hammond argued in his view that leaving without an agreement would go against British interests. Speaking shortly after Enders, Hammond said his government would do everything possible to support the aerospace industry.
(Adds the Honda production stop in the 12th paragraph.)
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