In case of major disruption to business because of a no deal Brexit, unpaid leave for two weeks or more would be forced on its workers at its Mini plant in Oxford in the United Kingdom, said BMW.
The company’s chief financial officer Nicolas Peter said that if problems of importing components were faced by BMW, the leading German auto major has made itself ready to close down its factory at Cowley for at least a fortnight starting from the 31 October Brexit deadline. He added that the company could even extend the shutdown to over three weeks.
Peter said that since the holiday allowances of the workers at the factory had been used up in April, following the March 29 deadline for Brexit, in a planned shutdown of the plant for a month by BMW, therefore this time, the 4,500 workers at the Cowley unit will have to go without any salary for the closure period.
“We are not capable of [having] a second holiday period in 2019 so this could have a financial impact on our colleagues working in Oxford,” Peter told the Financial Times at the Frankfurt motor show.
Even if the UK does not implement Brexit, the company will keep the plant closed on 31 October and 1 November. According to the company, this close down will help the company to counter any disruption and reduce the impact of delays to parts, thereby minimizing delays in car deliveries for a business that is closely integrated with the European Union.
BMW could be forced to stop manufacturing its Mini car in the UK if there is a no deal Brexit, the company has warned earlier. That would be a threat to the workers of a factory that has been in existence for more than a century. Minis are also made by BMW in Netherlands and managing a no-deal Brexit would involve production cuts as a “first step” by the company, Peter said.
Brexit without a deal was not acceptable and a compromise to avoid crashing out should be found out by the UK, said Carlos Tavares, chief executive of Vauxhall’s owner PSA speaking to the media at Frankfurt. “Sending two trains to crash at full speed into each other just to demonstrate the strength of your muscles doesn’t seem to be the best approach,” Tavares said.
In the case of a no deal Brexit, the rest of the company has to be protected by PSA, he said, and added that the company would take “all the necessary decisions” at its Ellesmere Port plant, according to a report published in the FT. if production at the factory becomes unprofitable after Brexit, PSA could scrap production there, Tavares had warned in July.
An impending hard Brexit has significantly brought down investment in Britain’s car industry to almost zero. Compared with new investment in the sector between £2.5bn and £2.7bn a year before the Brexit vote, the investment that has been pledged for in the first half of 2019 was £90m.
(Adapted from TheGuardian.com)