While a Brexit-related drop in consumer confidence that has led Jaguar Land Rover (JLR) to reduce production “can hopefully be overcome”, not having tariff free trade could “wipe out” automaker profits, Unite has warned.
Britain’s largest carmaker announced today (January 23) that it would be temporarily cutting production of two of its models as it fights flat-lining demand in the UK amid Brexit and diesel uncertainty.
Production of the firm’s Discovery Sport and Range Rover Evoque models, which are built at JLR plant in Halewood, employing 6,000 people, will be scaled back later this year.
“Ongoing uncertainty surrounding Brexit is being felt by customers at home and in Europe,” the firm said in a statement.
“Add to this concern around the future of petrol and diesel engines – and general global economic and political uncertainty – and it’s clear to see why the industry is seeing an impact on car sales.”
Unite national officer for automotive, Des Quinn, said that the Brexit uncertainty affecting the automotive industry extends beyond people putting off purchasing decisions over the short term.
He said, “Confidence is something that can hopefully be overcome.
“But not having tariff free trade could, worse-case scenario, wipe out profitability, both in terms of tax on finished cars and parts that make sometimes several trips backwards and forwards to Europe, as well as cause delays in the supply chain dependant on the customs arrangements.”
Unite assistant general secretary Tony Burke called on the government to get its house in order over Brexit and provide the certainty that UK automakers – including JLR – have said they desperately need.
“Car workers and manufacturing communities will be looking to the government to get the economy out of the slow lane in the year ahead and provide certainty over the UK’s future trading relationship with Europe in order to unlock stalling car manufacturer investment,” he said.
“A failure by ministers to do so will jeopardise the UK’s status as world leader in car manufacturing and undo the hard work of Britain’s car workers.”