Jaguar puts high price tag on a hard Brexit deal

BRITAIN’S biggest carmaker, Jaguar Land Rover, said a socalled “hard Brexit” would cost it 1.2 billion pounds (R21.5 billion) a year, curtailing its future operations in the UK.

“We urgently need greater certainty to continue to invest heavily in the UK and safeguard our suppliers, customers and 40 000 British-based employees,” JLR’s chief executive Ralf Speth said in a statement on Wednesday.

JLR joins a growing list of companies which have raised concerns about potential disruption to business if Britain crashes out of the bloc next March without a trading agreement with the EU, a so-called hard Brexit.

“The recent statement from JLR only reaffirms this position that a Brexit which increases bureaucracy, reduces productivity and competitiveness of the UK Industry is in no one’s interest,” JLR’s Indian parent firm Tata Motors Ltd said in a statement yesterday.

Shares in Tata plunged to their lowest in more than five years yesterday, as investors turned jittery on the company, whose biggest business is JLR, which contributed nearly 77 percent of its total revenue in the year ended March 31, 2018.

Speth’s comments come ahead of a meeting on Friday between Prime Minister Theresa May and her cabinet ministers to decide on strategy for Britain to negotiate its way out of the EU, ending a 40-year trading relationship.

Because of uncertainty about what Britain actually wants from the EU after it leaves, the outcome of the cabinet meeting is seen as critical to progress in talks with the EU on the issue.

Recent weeks have seen criticism of the government by some of the biggest companies operating in Britain.

Airbus and Siemens last week went public with their fears about what leaving the EU customs union and single market would mean for their businesses.

JLR said it needed “free and frictionless trade with the EU and unrestricted access to the single market”.

“A bad Brexit deal would cost JLR more than £1.2 billion in profit each year. We would have to drastically adjust our spending profile; we have spent around £50 billion in the UK in the past five years,” Speth said in a statement.