Automakers Prepare for “No-Deal” Brexit

They’re already under pressure from the deteriorating market.

Honda, the fourth largest car producer in the UK, has unveiled plans to halt its UK production for the first six days of April in order to stockpile parts in the immediate aftermath of Britain’s exit from the EU. The announcement came on Thursday, the same day that UK Premier Theresa May met her Japanese counterpart Japanese Prime Minister Shinzo Abe to discuss Brexit-related issues, and reads as follows:

“Honda of the UK Manufacturing Ltd has been assessing how best to prepare for any disruption caused by logistics and border issues following the UK leaving the EU on 29 March 2019.

“To ensure Honda is well paced to adjust to all possible outcomes, we are planing six non-production days in April 2019.

“This is to facilitate production recovery activity following any delays at borders on parts. These contingency provisions have been put in place to best mitigate the risk of disruption to production operations at the Swindon factory.”

Honda is not alone. BMW, the third largest car manufacturer in the UK, has announced plans to shut down its site in Cowley, Oxford, for maintenance during the whole month of April, in order to minimize the disruption a no-deal Brexit could cause to its production and supply chain.

The fifth largest manufacturer, Toyota, is also considering temporarily ceasing production in the event of supply-chain disruption. “If Britain crashes out of the EU at the end of March, we will see production stops in our factory,” said Marvin Cooke, the managing director of the company’s plant in Burnaston. Asked how long those stoppages could last, he said it was impossible to tell. “It could be hours, days, weeks – even months”

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