Jaguar Land Rover to Close UK Factories in November, Cites Brexit
Jaguar Land Rover intends to close factories in the United Kingdom for a week in November. While the move is to safeguard the company against a messy Brexit, the company has said it will take place whether or not the nation actually splits from Europe at the end of October. JLR Chief Executive Officer Ralf Speth confirmed the company’s decision late last month.
Brexit has been a long time coming. While the UK voted to leave the European Union over three years ago, considerable energy has gone into postponing the event to either undo the vote (via a follow-up referendum) or delay things long enough to reach a trade agreement with the EU. Automakers have encouraged a deal in order to avoid supply chain disruptions. However, Prime Minister Boris Johnson has said the nation has waited long enough, promising a no-deal Brexit on October 31st if an accord cannot be reached beforehand.
While JLR won’t be the only automotive manufacturer to temporarily shutter European plants over Brexit fears, reports suggest it’s likely to be the one with the broadest implications.
From Bloomberg:
The temporary halt will mean lost production for the unit of Tata Motors Ltd., already impacted by a global slowdown in the car industry. JLR brought forward its usual August maintenance closure as part of preparations for the original March 29 Brexit date, a measure that proved to be in vain after the deadline was shifted to October.
“We have to close,” Speth said. “You cannot switch it on and off. I need to make commitments to my suppliers, I need to have every part available and I need it just in time. If I don’t have a part, I don’t produce a car.”
The overriding fear is that abandoning the EU will create backups at the border, delaying parts automakers need to manufacture product. While this is largely seen as a temporary issue, some suggest it could be weeks before supply routes begin flowing smoothly.
BMW Group said it would halt production at its Mini plant in Oxford for two days, starting October 31st, regardless of how Brexit goes down. It also intends to eliminate a shift to reduce overall output if there’s a no-deal solution.
Toyota also plans on stalling its main European factory in the UK at the start of November. However, its closure will only result in a three-day weekend for staff — hopefully enough for it to avoid the worst of what Brexit has to offer. Toyota Motor Manufacturing UK said it plans on returning to business as usual on November 4th and intends to ship in extra materials beforehand to ensure an adequate parts supply.
[Image: jax10289/Shutterstock]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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With a no-deal Brexit looming, going to be hard to a manufacturer in GB and export your goods when it is just a big black hole on what that will look like.
A slow motion train wreck. Now I fully comprehend the meaning of the saying. Although the train is still on the rails...for now. It will be interesting to see which other economies will be severely impacted.