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Ford plant in Dagenham, England Copyright Carl Court, Getty Images

Ford Says Plants at Risk as It Urges UK to Reach Brexit Deal

Unnegotiated split ‘catastrophic’ for factories, company warns.

Ford Motor Co. (IW 500/3) warned of dire consequences for U.K. factories employing more than 7,000 people if British politicians fail to agree on a plan to avert a no-deal split from the European Union.

While cautioning that it has yet to reach any decision, the U.S. auto giant said a hard Brexit would be “catastrophic” for the U.K. auto industry and its own production facilities in a statement Wednesday.

“We have long urged the U.K. government and parliament to work together to avoid the country leaving the EU on a no-deal-, hard Brexit-basis,” the Dearborn, Michigan-based carmaker said in the release. “We will take whatever action is necessary to preserve the competitiveness of our European business.”

Ford made the comments after Britain’s Times newspaper reported earlier that the manufacturer had used a telephone call with Prime Minister Theresa May to reveal that it had stepped up preparations to move production out of Britain. There’s currently a political impasse around the premier’s plan as she seeks to renegotiate its terms with the EU to win backing from a majority of lawmakers.

Ford employs 13,000 people in Britain, more than half of them at plants in Bridgend, Wales, and Dagenham, near London, which make engines for gasoline- and diesel-engine vehicles respectively.

Office Merger

The company said last month when announcing thousands of job cuts across Europe that it would merge its U.K. head office with a nearby technical center to cut costs, while warning that measures in the event of a no-deal Brexit would be significantly more dramatic.

BMW AG said separately Tuesday that it’s taking Brexit-related decisions “as late as operationally possible” as the clock counts down to the March 29 split without a negotiated settlement in sight. Auto-industry investment in the U.K. dropped 46% last year to the lowest since the global financial crisis as other brands with British plants put key decisions on hold.

While carmakers are stockpiling parts to safeguard U.K. output should supply chains be disrupted after a no-deal break, many have also brought forward planned maintenance stops to April to help eke out components at such a critical time. The German company will idle its Oxford Mini plant from April 1.

Jaguar Land Rover, Britain’s biggest carmaker, said last month it would scrap 4,500 posts in response to a sales slowdown blamed on Brexit, as well as a drop in China sales and slumping diesel demand. PSA Group’s Vauxhall Ellesmere Port site is in doubt as it mulls plans for the next Astra.

In the biggest blow to date, Nissan Motor Co. this month reneged on plans to built the X-Trail sport utility vehicle at the U.K.’s largest car plant in Sunderland, northeast England.

By Christopher Jasper and Irene García Pérez, with assistance from Oliver Sachgau

TAGS: Operations
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