Airbus has issued a clear warning to the UK amid pullout from European Union, the company said a withdrawal without a deal on future trade might force it to reconsider the long-term presence in the UK.
Airbus has circulated a memorandum late on Thursday saying that the softer plans during the transition period until December 2020 are still short term to adapt to its supply chain mechanism and would compel it from expanding its supplier base in the UK.
Airbus currently produces wings for all of its passenger’s jets in the UK, the company said that exiting from the EU’s single market as well as customs union immediately without agreed transition could lead to serious disruption of production in the UK.
Tom Williams, Chief Operating Officer of Airbus Commercial Aircraft unit said, “If there is no deal, the future of Airbus in the UK is directly under a threat.”
Williams told its staff in March that Airbus is looking to buy more parts in order to build up a buffer stock to cope with an uncertain disruption in the UK when Britain leaves the EU on March 29, 2019. Earlier this week, Airbus talked with Germany’s Siemens to get immediate details how its operations would need to be organized.
According to the industry analysts, Airbus cannot pull out from the UK immediately because of the waiting lists of its planes and long lead time, but the company can consider shifting wings production for its single-aisle jets, the development of these jets is expected to start somewhere between 2023 to 2026 and Germany, Spain or emerging suppliers such as South Korea might be among the possibilities to take the work from the UK.
After the Brexit voting through a referendum on June 23, 2016, British Prime Minister Theresa May won a critical Brexit vote in the parliament on Wednesday, this was the second major event in this regard. The Prime Ministers divided government plans are now to end the 40 years of British Partnership with the European Union.
The future trading relations with EU, talks with bloc and plans are all stalled at this time; businesses are complaining that they are stuck, unable to make any future investment plans and decisions.
Liam Fox, the trade minister on Thursday said, the parliamentary vote on Wednesday had closed the door for good now there is no chance of staying in the EU. However, the country was keen to continue as it leaves the trading bloc.