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Airbus warns about no-deal Brexit

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Airbus warns about no-deal Brexit

Old 22nd Jun 2018, 10:27
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Originally Posted by brakedwell View Post
Those parts have to reach the assembly facilities seemlessly. Gridlock at UK ports after a hard brexit will clog up the supply lines and cause expensive delays. Standby by for similar announcements from Nissan, Honda and Toyota.
Indeed, by now we know for certain that there will be gridlock at UK ports after Brexit. Yet as we speak, goods are flowing smoothly to and from non-EU countries through container ports like Felixstowe and Southampton, and airports like Heathrow (including perishables), with no obvious gridlock. Something does not compute.

Last edited by OldLurker; 22nd Jun 2018 at 10:28. Reason: typo
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Old 22nd Jun 2018, 10:32
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Originally Posted by felixflyer View Post
If you are looking at the short term then you can forget about setting up a new factory and associated infrastructure, training staff and organising supply chains.

Brexit would be long sorted and over any chaotic term well before any of this could be set up elsewhere.
In the short-term Airbus are talking about stockpiling UK made/supplied components somewhere (as in somewhere that will still be in the EU). Of course the costs of this will fall against the UK operation making it brutally uncompetitive and cashflow to achieve it may kill some smaller suppliers but you'd guessed that already.
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Old 22nd Jun 2018, 10:38
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Originally Posted by brakedwell View Post
Those parts have to reach the assembly facilities seemlessly. Gridlock at UK ports after a hard brexit will clog up the supply lines and cause expensive delays. Standby by for similar announcements from Nissan, Honda and Toyota.
Went round the Oxford Mini factory last month - they have rows of trucks outside every morning doing JIT deliveries ... clearly they are worried s******* ... but as they pointed out they have a "second facility" in the Netherlands
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Old 22nd Jun 2018, 10:39
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Originally Posted by OldLurker View Post
Indeed, by now we know for certain that there will be gridlock at UK ports after Brexit. Yet as we speak, goods are flowing smoothly to and from non-EU countries through container ports like Felixstowe and Southampton, and airports like Heathrow (including perishables), with no obvious gridlock. Something does not compute.
I doubt if any just in time components travel by sea.
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Old 22nd Jun 2018, 10:39
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Originally Posted by brakedwell View Post
Those parts have to reach the assembly facilities seemlessly. Gridlock at UK ports after a hard brexit will clog up the supply lines and cause expensive delays. Standby by for similar announcements from Nissan, Honda and Toyota.
The solution, therefore, is simple. The EU must act to ensure that the post Brexit paperwork is seamless so the supply chain is not interrupted.
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Old 22nd Jun 2018, 10:40
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Originally Posted by OldLurker View Post
Indeed, by now we know for certain that there will be gridlock at UK ports after Brexit. Yet as we speak, goods are flowing smoothly to and from non-EU countries through container ports like Felixstowe and Southampton, and airports like Heathrow (including perishables), with no obvious gridlock. Something does not compute.
Look at the Swedish -Norwegian border - it's not open and there are lines and delays....
https://news.sky.com/story/sweden-wa...rexit-11140707

" Sweden's Europe minister has poured cold water on the idea of the UK enjoying "frictionless trade" after Brexit. Ann Linde, who has sat on the Nordic country's frontbench since May 2016, told Sky News: "It's not possible to have frictionless trade if you are not part of the customs union and the single market."

and Customs themselves reckon their "new" system for post Brexit isn't tested or ready partly because no politician can tell them exactly what to plan for

It really is a shambles..................
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Old 22nd Jun 2018, 10:42
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Originally Posted by Wig Wag View Post
The solution, therefore, is simple. The EU must act to ensure that the post Brexit paperwork is seamless so the supply chain is not interrupted.
It takes two to tango and our shambolic "government" is not capable of running a whelk stall.
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Old 22nd Jun 2018, 10:44
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Originally Posted by Wig Wag View Post
The solution, therefore, is simple. The EU must act to ensure that the post Brexit paperwork is seamless so the supply chain is not interrupted.
Why SHOULD they do anything??

We're the ones who brought this fandango on ................... why should they spend any time or money on it? Would we do the same if things were reversed???
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Old 22nd Jun 2018, 10:45
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I see that the usual suspects have already convinved themselves that Airbus is pulling a fast one. There really is no-one so blind as those who refuse to see, it's pathetic.
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Old 22nd Jun 2018, 10:55
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In the late nineties did a dissertation for my Masters on Scottish economy, grant aid, and company assistance entitled the Aircraft carrier economy. A 'lift an lay policy'. Company looking to locate. Where lie the easiest logistics, where lie the largest grant aid, skilled workforce etc etc. Bottom line, when the fuel runs out, they move, overnight in some cases, to the next carrier. Life is numbers, pure and simple. Scotland HAD a thriving computer/electronics industry. All gone. Along with millions of grant aid. Issue is when it is not coming out of your own pocket, it is very easy to spend millions of public cash, also very easy just to leave it all behind.

I still cannot believe what the UK is actually doing here. Ultimate consequences will be interesting.
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Old 22nd Jun 2018, 10:59
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Originally Posted by Heathrow Harry View Post
Why SHOULD they do anything??

We're the ones who brought this fandango on ................... why should they spend any time or money on it? Would we do the same if things were reversed???
Again, easy. The national Governments of France, Germany and Spain will not want Airbus compromised by EU intransigence. They will lobby the EU for an uninterrupted supply chain post Brexit. The EU will need a damned good reason for putting French, German and Spanish workers out of a job.
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Old 22nd Jun 2018, 11:02
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Originally Posted by brakedwell View Post
I doubt if any just in time components travel by sea.
How do you think A380 wings get from Broughton to Toulouse ?

On second thoughts, there's no rush for those any more.
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Old 22nd Jun 2018, 11:03
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I see that the usual suspects have already convinved themselves that Airbus is pulling a fast one. There really is no-one so blind as those who refuse to see, it's pathetic.
The same can be said in reverse. It's important to find out the real reasons behind any potential job losses and try to solve them or find alternatives that work for the UK.

Using these announcements to justify a remain view and holding a 'we're doomed' view is frankly more pathetic. Brexit is happening and we should all be working to make it as successful as possible. Anyone just sitting back waiting for it to fail so they can say 'I told you so' needs to stand aside as they are no use whatsoever.

Why SHOULD they do anything??

We're the ones who brought this fandango on ................... why should they spend any time or money on it? Would we do the same if things were reversed???
This is not the school playground.

They are a business and if this is a business decision based on cost and in fear of any disruption from Brexit then absolutely they should, and would, work with the UK to try to minimise any potential problems. These are the kinds of issues that need highlighting to force both sides to come to agreements that work. Any business would do so to protect itself and shareholders. Moving elsewhere will not be a cheap or easy process so if staying can be made to work then they will.

I hope the announcement is an attempt to do the above and get some order in place rather than an attempt by Germany & France to punish the UK.

If it is the former then it can only be a good thing and I hope it achieves the required result.

If it is the latter then it only goes to strengthen the Leave case.

Interesting times.
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Old 22nd Jun 2018, 11:09
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Good luck to Airbus in setting up and bringing on stream a new, duplicate, wing building facility elsewhere between now and next March. They cannot transfer equipment or personnel from the existing operation as they need to maintain full production to meet their delivery schedules. As for setting up in the US or China, that seems to be a gamble as they don't know what the tariff situation may be in future (especially the US!). An operation in the EU would see protracted squabbling between France, Germany and Spain over where it was to be located before any work started! You can bet that there will be pressure from Airbus on EU governments to do a deal as they do not want this unnecessary expense, as there will be from companies like Ford whose biggest market in Europe is the UK, but who do not build a single vehicle in the UK.
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Old 22nd Jun 2018, 11:21
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Originally Posted by Cynical Sid View Post
There will be many large companies in the same position. They have largely kept silent, presumably under pressure from some inside the British government. Land Rover last week chose to move more of its manufacturing to Slovakia (or Slovenia). It will be interesting to see if Airbus have triggered other companies to speak up.
Change the company name and the product they sell is just an excuse to move their production to Eastern Europe or the Far East where they can build it cheaper.

Airbus/BAe (that was) don't give a $hit about their employees, build it cheaper, more profit for the company.
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Old 22nd Jun 2018, 11:23
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If Sterling is such a strong currency after BREXIT that it makes economic sense to take Airbus business elsewhere, then bring it on I say. Money talks, if sterling goes lower, it would be a brave or stupid politician willing to pay through the nose for an inferior product.

IG
 
Old 22nd Jun 2018, 11:39
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Originally Posted by OldLurker View Post
Meanwhile, on the US trade war, Jean-Claude Juncker says "we will do what we have to do to safeguard the EU". Perhaps he might say whether he thinks EU trade with the UK (currently world's 5th largest economy) also needs safeguarding, and if so, what positive action is he taking to do so?
Fall of the £ and dismal growth since Brexit vote U.K. has dropped to world’s 6th largest economy and is forecast to be 7th by end of the year.
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Old 22nd Jun 2018, 11:43
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Originally Posted by ImageGear View Post
If Sterling is such a strong currency after BREXIT that it makes economic sense to take Airbus business elsewhere, then bring it on I say. Money talks, if sterling goes lower, it would be a brave or stupid politician willing to pay through the nose for an inferior product.

IG
Why would the product be inferior?
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Old 22nd Jun 2018, 12:03
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Airbus has always been inextricably entwined in euro politics. It's no surprise at all to see them toeing the line of the EU commission.
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Old 22nd Jun 2018, 12:11
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Originally Posted by Alan Baker View Post
Good luck to Airbus in setting up and bringing on stream a new, duplicate, wing building facility elsewhere between now and next March. They cannot transfer equipment or personnel from the existing operation as they need to maintain full production to meet their delivery schedules. As for setting up in the US or China, that seems to be a gamble as they don't know what the tariff situation may be in future (especially the US!). An operation in the EU would see protracted squabbling between France, Germany and Spain over where it was to be located before any work started! You can bet that there will be pressure from Airbus on EU governments to do a deal as they do not want this unnecessary expense, as there will be from companies like Ford whose biggest market in Europe is the UK, but who do not build a single vehicle in the UK.
Thing is, airbus is not trying to set up something until march, they just said that they work with their supply chain to start stock piling material so that any border disruptions will not disrupt the production in the short run. In the medium run however, yes, they are of course looking at moving the wing production out of the UK. It certainly won't happen until march, and it certainly won't stop all at once, but rather fade out over time as other facilities come online. China is a logical choice for some of the production, as it cuts down transport lead times for their local end production line there.
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