Prof. Dr. Ralf Speth, Chief Executive Officer of Jaguar Land Rover Automotive plc, Britain’s largest vehicle manufacturer, called on the UK Government to urgently provide certainty for business including guaranteed tariff-free access and frictionless trade with the European Union.
Ahead of the publication of a White Paper outlining the Government’s proposed post-Brexit trading relationship with the EU, Dr. Speth said: “Jaguar Land Rover’s heart and soul is in the UK. However we, and our partners in the supply chain, face an unpredictable future if the Brexit negotiations do not maintain free and frictionless trade with the EU and unrestricted access to the single market.”
“We urgently need greater certainty to continue to invest heavily in the UK and safeguard our suppliers, customers and 40,000 British-based employees.”
“A bad Brexit deal would cost Jaguar Land Rover more than £1.2 billion ($1.9 billion) profit each year. As a result, we would have to drastically adjust our spending profile; we have spent around £50 billion ($66 billion) in the UK in the past five years, with plans for a further £80 billion ($105.6 billion) more in the next five. This would be in jeopardy should we be faced with the wrong outcome.”
“For more than 250 years, since the era of Adam Smith, Britain has championed free markets and made the case for free trade. If the UK automotive industry is to remain globally competitive and protect 300,000 jobs in Jaguar Land Rover and our supply chain, we must retain tariff and customs-free access to trade and talent with no change to current EU regulations.
“Electrification and connectivity offer significant economic and productivity opportunities, get Brexit wrong and British people, businesses and broader society lose the chance to lead in smart mobility.”
Jaguar Land Rover being Britain’s largest car manufacturer, investor, exporter and employer, has more than 40,000 employees that are based in the UK, with a further 260,000 jobs in the UK supply chain.
In 2017 JLR sold 621,000 cars, with 80% of them going to 130 countries; 1 in 3 cars exported from the UK are Jaguars or Land Rovers. Mainland Europe is one of JLR’s largest markets, with 20% of cars being sold there.
In the current financial year JLR intends to invest £4.5 billion ($6 billion), with more than half going into development of new vehicle models and technologies. Jaguar Land Rover’s UK tax contribution exceeds £2 billion ($2.64 billion) per year.
Jaguar Land Rover in the financial year 2017/2018 spent £5.67 billion ($7.48 billion) with UK suppliers and £5.37 billion ($7.09 billion) with EU suppliers on production parts. More than 40% of parts going into their cars are imported from Europe.
Solihull, the UK’s largest car plant, builds 1,500 cars per day, using 15 million components. Any delay to parts delivery would force the suspension of production at a cost of £1.25 million ($1.65 million) per hour.