‘No shutdown’ if no-deal Brexit
THE boss of Toyota’s Derbyshire car manufacturing plant has said the company has no plans to halt production in the immediate aftermath of a “no-deal” Brexit.
But Marvin Cooke, managing director of Toyota Manufacturing UK, said he remained concerned about the short-term impact it might have on the firm’s supply chain – and the longer-term effect it could have on the Burnaston factory’s competitiveness.
Mr Cooke made his comments at the Society of Motor Manufacturers and Traders (SMMT) Regional Forum Midlands, which took place at Derby County’s Pride Park Stadium last week.
Last month, there were reports that the Japanese car-maker was anxious that a no-deal Brexit be avoided at all costs because of the potential impact border controls could have on production at Burnaston.
Toyota operates a “just-in-time” strategy for its manufacturing which relies on a constant supply of parts many arriving from companies in Europe.
Currently parts arrive at the factory within hours of when they are needed on the production line.
But a no-deal Brexit could result in potential hold-ups at border crossings, which would cause serious production delays.
Britain is due to leave the EU on March 29. But under a deal reached earlier this year, a 21-month transition period would begin after March 30, during which most aspects of EU membership will stay in place, including free movement across borders and membership of the customs union and single market.
However, this will only happen if some form of agreement is reached before the day the country is due to leave.
BMW has already said that it would shut down its Mini factory in Oxford for a month after Brexit at the end of March to minimise disruption in the event of a no-deal outcome.
It said its summer maintenance shutdown had been brought forward to April 1 to reduce any “possible short-term parts-supply disruption”.
But Mr Cooke said that there were no plans to do the same at Burnaston, which exports the majority of the cars it makes to mainland Europe.
He said: “This is actually an exciting time for the factory. We’re moving to a new way of making cars and we’re very excited about starting production on the new Toyota Corolla by the end of the year.
“By the end of March we will have ramped up to full production. It would make no sense for us to stop then, so we are not planning any closures or shutdowns.
“We have always said that free and frictionless trade with the EU is vital for the future competitiveness of the UK motor industry.
“We want to see a hard Brexit avoided at all costs. If it is a hard Brexit then in the short term we would be concerned about interruptions to our ‘just in time’ supply chain. We don’t know how long those interruptions would be.
“In the longer term, anything that can be done to mitigate the impact of controls on exports would be welcomed.”
Mike Hawes, chief executive of the SMMT, said that as well as posing challenges to car manufacturers like Toyota, a no-deal Brexit could have “devastating consequences” for small and medium-sized companies in the supply chain.
At the forum, which was attended by more than 200 representatives from the automotive industry, he said that the sector was now “planning for the worst” as the date for Britain’s withdrawal from the EU loomed. But he added that he was “optimistic” that a deal could be achieved.
According to the SMMT, the car industry is crucial to the regional economy. It said that some 12,000 automotive jobs exist across the East Midlands, including those at Toyota’s Burnaston plant.
However, many of these jobs could be in jeopardy if Britain leaves the EU without a deal in place.