Brexit: what are carmakers’ contingency plans?

From stockpiling to Nissan’s U-turn on making new model in the UK, here’s what firms are doing

car-production-trail-image — More than 1.5m cars were made in the UK last year.
Photograph: Cath Levett/The Guardian

UK-based carmakers have triggered a wave of Brexit contingency plans, with Nissan the latest manufacturer to warn that uncertainty around leaving the EU is “not helping” companies.

The British car industry is a major exporter, with eight out of 10 cars sold abroad to markets including the EU, the US and China. The sector made more than 1.5m cars last year, although the industry body, the Society of Motor Manufacturers and Traders, revealed that investment by manufacturers almost halved in 2018 to £588.6m.

A series of emergency Brexit measures – including stockpiling and bringing forward temporary factory closures – are expected to impose extra costs on a highly competitive industry. For instance, Jaguar Land Rover, which owns multiple sites in the West Midlands, is stockpiling parts and Honda plans to halt production at its Swindon plant for six days after Brexit day on 29 March.

Car manufacturing is a flagship industry in the UK, having staged a remarkable recovery since the 1970s. A host of major international firms have sites in the UK, ranging from Nissan and Toyota to BMW and Volkswagen, with JLR playing a central role as the largest employer in the sector.

The concern among industry executives is that a disorderly Brexit would throw finely tuned supply lines into chaos by disrupting Britain’s import and export markets. For multinational companies with little to tie them to the UK, that could make investing elsewhere the safer option.