BMW will shutter Mini factory for a month to protect against ‘no-deal’

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JPMorgan CEO: We have to prepare for a hard Brexit

First Jaguar, now Mini. Brexit is already taking part in havoc with the enterprise of constructing vehicles in the UK and placing worry into world automakers.

BMW (BMWYY) mentioned Tuesday that it might shut its Mini manufacturing unit in England for one month of upkeep instantly after Brexit as a result of it will possibly’t be certain of getting the components it wants if the UK leaves the European Union with no commerce deal.

“Whereas we imagine this worst case situation is an unlikely final result, we now have to plan for it,” mentioned BMW, which employs four,200 employees at its Mini plant in Oxford.

Brexit will take impact on March 29. The Mini shutdown will start on April 1.

The most important carmaker within the nation, Jaguar Land Rover, cited uncertainty over Brexit on Monday as one motive for placing 1,000 employees on a three-day work week till Christmas.

BMW mentioned it stays dedicated to the UK, however the announcement underscores fears that Brexit may hike prices and snarl the availability chains that underpin British automotive manufacturing.

Honda (HMC) government Ian Howells informed the BBC on Tuesday that crashing out of the European Union would price his firm “tens of thousands and thousands of kilos.”

oxford mini plant FILE
The Mini plant in Oxford will likely be shut for a month following Brexit.

The sluggish tempo of Brexit negotiations has heightened fears in latest months that Britain might go away the European Union in March with out agreeing a transition deal to maintain it quickly within the bloc’s single market and customs union. Even when a deal is reached, the phrases of commerce between Britain and its largest export market might stay unsure manner past that deadline.

The stakes are particularly excessive for the British auto trade, which has already been battered by a pointy decline in gross sales of diesel automobiles within the nation.

The British automotive manufacturing sector employs over 800,000 employees and about 45% of the vehicles made in Britain are exported to the European Union.

Along with BMW, Honda and Jaguar Land Rover, which is owned by India’s Tata Motors (TTM), Toyota (TM) and Nissan (NSANF) have large factories within the nation. Ford (F) additionally makes engines at two crops.

Funding has slowed dramatically in latest months.

The Society of Motor Producers and Merchants mentioned in June that funding in new fashions, tools and amenities in the UK was £347 million ($460 million) within the first half of the 12 months, in comparison with £647 million ($860 million) in the identical interval of 2017.

CNNMoney (London) First revealed September 18, 2018: 12:06 PM ET

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