‘A no-deal Brexit would be catastrophic’ –Aston Martin
ASTON Martin’s chief financial officer has warned that leaving the EU without a deal could prove “semi-catastrophic” for the car manufacturer and force a temporary halt to production.
Mark Wilson left MPs in no doubt about the scale of concern in the industry.
Aston Martin selected the Ministry of Defence’s St Athan site in the Vale of Glamorgan as the location for its second UK manufacturing plant. Earlier this year it stated it was on target to start production of its new crossover, the Aston Martin DBX, in 2019.
At present, cars approved by the Vehicle Certification Agency (VCA) can be sold across the EU. If a deal is not agreed to allow this arrangement to continue after Brexit, car-makers fear production will have to stop until new certification to sell vehicles abroad is secured.
Appearing before the Business, Energy and Industrial Strategy Committee, Mr Wilson set out his concerns.
He said: “[For] Aston Martin it is far, far simpler than it is perhaps for Honda and some of the other larger international players.
“We are a British company. We produce our cars exclusively in Britain and will continue to do so, and without VCA-type approval it really is quite a stark picture for us.”
He warned that if this type of approval was not carried over, there would not only be “significant costs” but “the semi-catastrophic effects of having to stop production because we only produce cars in the UK”.
Mr Wilson also stressed the need for clarity so the company could plan where to invest.
He said: “For Aston Martin for example, we are on a fast growth trajectory at the moment. That implies that we are investing more heavily than we would in the normal cycle.
“Typically for us, our product cycle is seven years long. You would therefore expect to be investing at least three years in advance in new product cycles, and about 60% of our supply chain is in the EU, with the balance in the UK.
“And so, as we go through this ramp-up period now, deciding where we will invest in that supply chain is critical...
“Those decisions are happening every day, each day, and we are waiting to see what will be the outcome and therefore clarity is absolutely at a premium for us.”
Stating that it was “really, really important” to get “clarity quickly,” he said: “It’s very difficult to scenarioplan given an extremely wide range of outcomes, some of which are binary opposites to each other.”
Mr Wilson added the company would face a “real problem” if UK manufacturers had to rely on World Trade Organisation rules to trade but were also saddled with a strong pound.
He emphasised the need for Aston Martin to be able to recruit talented workers from the EU, stating: “About 10% of our workforce is European. But it’s a very highly skilled workforce.
“These are top-class engineers, aerodynamicists, vehicle dynamics engineers – the skill level is high and we need to maintain access to that talent.”
However, he said he was “encouraged” by talks about transitional arrangements.
Liberal Democrat Brexit spokesman Tom Brake said: “An extreme Brexit risks bringing parts of our thriving car industry to a standstill. People’s jobs are on the line, but still the hard Brexiteers are peddling the fantasy that we could crash out of Europe with no deal.
“Every day of Government complacency brings us closer to a catastrophic Brexit that would destroy jobs, push up prices and damage living standards.
“The Government must stop being so complacent and protect British businesses by ruling out no deal.”