‘Negative’ Brexit Impact A Threat For Future Of Airbus In UK

Airbus has warned the UK government about the “severe negative consequences” of Brexit which could force the aerospace giant to exit Britain. The government has said that it will hold discussions with the company.

It has been two years that the country had voted in favor leaving the European Union (EU) and the reaction of Airbus clearly reflects the increasing concerns among UK businesses about their uncertain future after completion of Brexit.

“We’ve come to the point where we have to make serious decisions. We can’t continue with the current vacuum in terms of clarity,” Tom Williams, chief operating officer of Airbus’s commercial aircraft division, told the media.

The government has said that it was “listening” to the concerns of the company and that it was also in regular touch with ministers.

“We are confident we are going to get a good deal that ensures that trade is as free and frictionless as possible,” spokeswoman for prime minister Teresa May said. she added that a meeting of officials from the business department is scheduled with Airbus

According to a Brexit risk assessment estimate made by the company has projected losses of up to €1bn a week in sale revenues if there is no agreement about the future of trading relationships between the UK and the EU after completion of the three-year period and the completion of Brexit or the UK leaving the EU. Airbus has 15,000 employees throughout 25 sites in the UK.

Airbus was seeking to undertake serious decisions related to the future “over the next weeks” and that the company felt that the situation was becoming “too dangerous to proceed”, Williams said.

The news about Airbus is reflective of the growing sense of “abject frustration” among the large UK companies in aerospace, automotives and pharmaceuticals, said Stephen Doughty, a Welsh Labour MP. “Their complaints in private have intensified in the last few weeks, they are increasingly scathing about both the course the government is on and the complete lack of clarity,” he said.

He had heard of a number of companies which had put on hold investment decisions because of the uncertainty over Brexit, said Tom Crotty, group director at petrochemicals group Ineos, and chair of the CBI’s manufacturing council. “It is very difficult to engage the government on any subject at the moment that is not Brexit,” he said.

Currently the European Aviation Safety Agency governs the suppliers of parts in the UK. Williams said that aircraft with British parts will not be valid without the certification of the Agency and in case the UK does not agree to align itself with EU standards through a new British agency.

“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’s future in the UK,” he said.

“The current planned transition (which ends in December 2020) is too short for the EU and UK governments to agree the outstanding issues, and too short for Airbus to implement the required changes with its extensive supply chain.

(Adapted from FT.com)

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Categories: Economy & Finance, Geopolitics, Strategy, Sustainability, Uncategorized

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