Airbus Chief: Brexit ‘No Deal’ directly threatens Airbus’ future in the UK.
A Brexit ‘Risk Assessment’ published on Thursday by Airbus has painted a grim picture of what a ‘No Deal’ Brexit would look like for the European planemaker in the UK.
Airbus has issued its starkest warning yet to the UK Government that the company faces urgent risks to its business arising from the UK exiting the European Union without a withdrawal agreement,
The planemaker says a No Deal would lead to severe disruption and interruption of UK production and leave Airbus considering its future in the UK.
“Far from Project Fear, this is a dawning reality for Airbus.” – Tom Williams – Airbus COO
The company, employs 14000 in the UK, around 6000 people work at Broughton – it supports a further 110,000 jobs in its supply chain in the UK.
The Brexit ‘Risk Assessment’ says:
‘In case of the UK leaving the EU without a deal on the 29th March 2019, there would be no Transition Phase, the UK would leave the Single Market, the Customs Union and the European Court of Justice jurisdiction. Therefore, WTO rules would kick in and numerous frictions would heavily impact our operations and that of our supply chain.’
It goes onto say:
‘Airbus’ production is likely to be severely disrupted due to interruption to the flow of parts and/or discontinued airworthiness. Given today’s prevailing uncertainty, buffer stocks valued at around €1bn would be needed.’
Given Airbus’ steep ramp-up demands on the best-selling A320 and A350 families, our critical industrial capabilities are already running at full capacity.
With no spare capacity left over years to come, every disruption to production would most likely turn into an unrecoverable delay.’
Airbus says a no deal scenario would force it to reconsider its investments in the UK, and its long-term footprint in the country, severely undermining UK efforts to keep a competitive and innovative aerospace industry, developing high value jobs and competences.
‘A no deal Brexit must be avoided, as it would force Airbus to reconsider its footprint in the country, its investments in the UK and at large its dependency on the UK. Given the “No deal/Hard Brexit” uncertainties, the company’s dependence on and investment in the flagship “Wing of Tomorrow” programme would also have to be revisited, and corresponding key competencies grown outside the UK.’
Tom Williams, Chief Operating Officer of Airbus Commercial Aircraft, commented:
“In any scenario, Brexit has severe negative consequences for the UK aerospace industry and Airbus in particular. Therefore, immediate mitigation measures would need to be accelerated.
While Airbus understands that the political process must go on, as a responsible business we require immediate details on the pragmatic steps that should be taken to operate competitively.
Without these, Airbus believes that the impacts on our UK operations could be significant.
We have sought to highlight our concerns over the past 12 months, without success.
Far from Project Fear, this is a dawning reality for Airbus.
Put simply, a No Deal scenario directly threatens Airbus’ future in the UK.”
Reaction:
Alyn and Deeside AM Jack Sargeant said:
“I have continuously pushed for assurances & clarity from the UK Govt on this issue – unfortunately, this has not been forthcoming.
We’re at such an important stage in the Brexit negotiations. It isn’t too late for the UK Govt to finally show some leadership and provide the clarity business needs. If this news isn’t a wake up call to the Government, then I’m afraid nothing will be.
I am already in liaison with various decision makers and Unite Wales about this issue workers urgently require reassurance. I can confirm that I have today requested an emergency statement in the Assembly.”
Welsh Government spokesperson said:
“The announcement from Airbus is extremely worrying. We have repeatedly warned that the UK cannot take the huge economic risk of cutting ourselves adrift from the Single Market and Customs Union.
Particularly in the case of manufacturing sectors, which in Wales are so important in providing high-paid, high-skilled jobs.
We have again today called on the UK Government in its forthcoming White Paper to commit to staying inside the Single Market and Customs Union.”
