mmarshall

I thought an interesting topic to discuss would be how much, if any, the departure of at least Great Britain from the EU (Scotland, Wales, and Northern Ireland are still unclear) would mean for British-brand auto firms, though most, if not all of those firms, today, are actually owned by companies headquartered in other countries. Dave has asked us not to discuss politics or political issues, so the intention of this thread is not to start a discussion on British politics or the election....and I'll ask posters to refrain from the recent election itself, and/or the British political parties involved, and concentrate on what Brexit could mean for the future of British-marque vehicles.

As of now, it looks like Brexit will, in one form or another, become a reality after January 31, although a number of details will have to be worked out, and perhaps new trade-agreements reached. An interesting question, I think, will be if relaxing the EU restrictions could allow Britain to have a more business-friendly atmosphere that would allow some of the vaunted British marques (Jaguar, Rover, MG, Sterling, Bentley, etc..... to either come back home to Britain, period, or allow more of their vehicles to (once again) be assembled there, in British plants.

I'm not suggesting that things could (or would) go back to the days of the huge domestic British Leyland conglomerate (that is highly unlikely, given the economic realities of today). In fact, Jeremy Clarkson did an excellent video on what essentially drove the old British car industry either out of business or out of the country, into the hands of other corporate-owners.....I'll include it here for reference, as it is one of the few videos he did that I ever really liked.


I know we have some posters (like Big Andy) who actually live there, and others, like bitkahuna, who regularly travel in and visit the country...their views might be interesting to hear.

Och

iTrader: (3)

I am not very familiar with British auto industry, outside of the brands that are present in the US market - Jaguar and Range Rover, and I'm not even sure if these are even manufactured in Britain. There were a bunch of other brands that I heard of, mostly due to watching Top Gear, but its a lot of information that I don't really have time to digest and comprehend.

One thing that I always wondered about is how come the German automakers penetrated the US auto market, while the British did not?

mmarshall

The British, at one time, did have a significant penetration of the U.S. market, but, except for a few icons like the slick-looking Jaguar XKE, it was primarily small, open-top roadsters with horrendous reliability and zip-up fabric tops and side-curtains that leaked like a sieve. They were forced out when the public had finally had enough. The Germans, on the other hand, first penetrated the American market with the durable, well-built, air-cooled VW Beetle, which, despite its stigmas of poor crash-safety, ill-handling from the swing-axles, a joke of a heating system, and having been developed in **** Germany (on Hitler's orders), endeared itself to many Americans, in the 1950s, as the ideal counterculture and fuel-saving vehicle.

Big Andy

Of the 1.6 million cars and 2.7 million Ford and BMW engines made in the UK each year, 80% are exported, with supply chains stretching back and forth across Europe. Brexit has the potential to be the biggest ever disaster to the UK's car industry, should tariffs be imposed and free movement of goods restricted. At the moment I can't see any upside to it.

Nissan, Jaguar Land Rover, Toyota, Vauxhall, Bentley, Rolls Royce, Lotus, McLaren, BMW MINI, Aston Martin all have vehicle plants building cars here. The luxury marques might be OK but if you take Nissan's Washington plant - that makes more cars in one year than the whole of Italy combined and is one of their most productive plants - there's a question mark over its future now. Toyota's Derby plant is said to be safe but it's only producing Corollas and is at half capacity. Honda has closed its Swindon plant - albeit after years of declining sales due to poor products and the latest Civic being a styling disaster. Jaguar Land Rover is investing in capacity and their new plant in Slovakia building the new Defender will help them if they have to move more production to Europe.

So potential dark clouds on the horizon and worrying times.

BTW the flag in the original post is not a British Union flag, someone's messed up there. This is one:

mmarshall

^^^Thanks for your input, Big Andy. Your comments are interesting, as it seems that many (if not most) of the auto-workers in the plants, particularly older ones, were supportive of Brexit. But, time will tell.

bitkahuna

iTrader: (20)

not surprised you're a remoaner.

the upside is UK won't be funding EU to do stupid things like send money to Libya so they won't send more refugees over which EU members must take, oh unless you're Hungary or Poland and say F hell no.

beating italy is a low bar.

but the party i expect you voted for hates cars and would rather they were all banned and everyone stood at rainy bus stops or trains that aren't running half the time. so maybe some upside, eh?

britain will be just fine and i suspect better than ever.

Big Andy

bit, don’t talk bollocks, don’t insult me and make yourself look foolish -you have no idea which way I voted in the referendum or in the General Election. Since you know all tell me what advantage the imposition of tariffs will have on the UK motor industry and the tens of thousands who are employed by it?

The original post was about Brexit’s effect on the motor industry and not the wider country, so stay on topic Eh?

bitkahuna

iTrader: (20)

Big Andy, just pulling your leg (note smileys)... you're right, i don't know how you voted, just guessing based on reading your posts in the past.

what tariffs are you talking about, have they already been announced, or ones you expect to be imposed by EU?

LeX2K

The strongest economy in the world is not part of any unelected union so the I think the UK will be just fine.

Big Andy

Apart from NAFTA, of course (and the EU is not an unelected union so I'm not sure what union you're referring to).

To explain:

All vehicles and parts from outside the EU are subject to a 10% import tariff. As Japan is outside the EU its imports were subject to this tariff, so they looked to build cars within the EU to avoid this. As a member of the EU the UK was an attractive place to set up plants, so Honda, Toyota and Nissan moved here in the 80s and 90s. If the UK leaves the EU without a deal tariffs will be imposed on Japanese cars and parts leaving the UK for delivery to Europe (80% of production, remember). In addition the EU has signed a trade deal with Japan to gradually reduce import tariffs on cars made there so we could have the situation where cars built in Japan and exported to EU countries don't incur tariffs and ones built in the UK (and outside the EU-Japan trade deal) do. In this situation why would a Japanese car manufacturer keep its UK plants open - particularly when they have excess capacity at home? We've already seen Nissan cancel plans to build the X-Trail (Rogue) here and is a holding pattern waiting to see what happens, and Honda has closed Swindon. Toyota could be next.
The UK automotive industry employs over 800,000 people and contributes 14.4% of all UK exports so it's a hell of a gamble to put all those jobs on the line over ideology. It costs the UK $14 billion a year to be in the EU - 1.3% of Government spending so claiming that we send vast amounts of money to them is plainly not true, and in return we get free access to a market of over 500 million people. Personally, I don't think it's a bad deal - if a certain person in The White House had struck it he'd be trumpeting it on twitter all day. The EU needs reforming but I think you do that from within, rather then standing helplessly outside while France and Germany reform it to their needs and not ours.

LeX2K

Can't discuss politics here and seeing Brexit is all politics I say close this thread.

All4Lexus

Back on topic.

I'd venture it delays any new ventures or significant expansion until 2-3 years after things normalize from a Brexit. So if it is a done deal in 2020, and things are uncertain for 2 more years..to a normal business climate and what the rules are... we are looking at 2024-25 for any new auto industry opportunities or growth in the UK. The bigger question is what operations will be able to survive during this uncertain business climate.

spwolf

Uncertainty definitely did not help UK industry and what you mentioned is what everyone can read in the media - I do not see how can they recover from what was already happening.

It is not politics - it is uncertainty.

mmarshall

IMO, no need to close it. I started the thread with a request to other posters (which I'll repeat it here) that British politics per se (parties, campaigns, speeches, elections, etc...) be avoided, and that we simply concentrate what Brexit would do to the British auto industry....which is a legitimate Car Chat topic. IMO most, though not all, of the posts, have generally followed that.

LeX2K

Here's what will happen, UK will prosper post Brexit trade deals will be inked as per usual. UK will be able to get the deal that is best for them not what the EU thinks is best. Done.