Airbus outlines Brexit no-deal risk assessment

Published:  08 August, 2018

Airbus has outlined its risk assessment to its business arising from the UK exiting the European Union without a withdrawal agreement.

It states that the UK exiting the EU next year without a deal – therefore leaving both the single market and customs union immediately and without any agreed transition – would lead to severe disruption and interruption of UK production. Airbus says that this scenario would force the company 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.

On the future trade relationship between the UK and EU, the Memorandum makes clear that while an orderly Brexit with a withdrawal agreement is preferable to a no-deal scenario, 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. In this scenario, Airbus would carefully monitor any new investments in the UK and refrain from extending the UK suppliers/partners base.

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.”

The Guardian Newspaper reported that John Longworth, the co-chair of Leave Means Leave campaign, was accusing Airbus of running a scare story and reheating ‘Project Fear’. He argued that tariffs on aeronautical products were zero, and as a consequence nothing would change as a result of the UK leaving the customs union. However Airbus’ risk assessment analysis, highlighted that the main concerns are over movement of employees between the UK and the EU, logjams in the supply chain and aircraft regulations.

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