Jaguar and Honda Prepare for the Brexit with Stoppages and Cutouts

The Prime Minister of Japan, Shinzo Abe, says in London that “he expects to avoid a Brexit without agreement.”

Share Give it a Spin!
Follow by Email

The Prime Minister of Japan, Shinzo Abe, says in London that “he expects to avoid a Brexit without agreement.”

The British car maker Jaguar Land Rover and the Japanese firm Honda announced yesterday measures to deal with the problems arising from the departure of United Kingdom of the European Union, in one more example of the negative consequences that Brexit is causing in the British economy.

Jaguar announced that it will cut 4,500 jobs worldwide, of which 4,000 will affect British workers, while Honda explained that it will stop production for six days in April due to the possibility of delays in the arrival of components from European countries, once activated the Brexit (March 29). BMW announced a similar measure for its Mini model plant before the summer.

Most of Jaguar’s layoffs will affect office staff to streamline the structure of the company. These dismissals join the 1,500 carried out a year ago. Jaguar has 43,200 employees, almost all in the United Kingdom. The firm, which belongs to the Indian conglomerate Tata, recorded losses of 90 million pounds (100 million euros) in the quarter of last year ended on September 30, compared to a benefit of 385 million one year earlier. With the fall of sales in China and in Europe of Land Rover models, political uncertainty in the United Kingdom is joining.

For more than a year, the company has been announcing that Brexit was going to pass an important bill to the sector. Last July, the firm indicated that it needed more clarity regarding what was going to happen with the Brexit to continue investing in the United Kingdom. He also explained that an exit from the EU without an agreement would lead the company to lose 1,200 million pounds per year of profit.

The automobile sector is one of the most troublesome after the Brexit, given the great dependence it has on the components that come from other European countries and that must cross the English Channel. If there is not a Brexit with agreement, the retentions of merchandise on both sides of the Canal will jeopardize the precision with which the car firms work when it comes to assembling the vehicles in the British plants.

The Japanese firms, which have a strong presence in the United Kingdom, are some of those that can lose most if in the end there is no agreement between Brussels and London. Yesterday morning, Japanese Prime Minister Shinzo Abe said in London that:

“We hope to avoid a Brexit without agreement, in fact, this is the wish of the whole world.”

The Japanese politician added that:

“Japan fully supports the exit agreement signed between the United Kingdom and the EU.”

The relationship between Japan and the United Kingdom has flourished in recent years. As Abe said, Japanese companies have created more than 1,000 companies in the United Kingdom and 150,000 jobs. “Japan and the United Kingdom have created a strong alliance,” he said. The uncertainty that exists in these moments in the United Kingdom has caused that the leader of the opposition, Jeremy Corbyn, has asked for early elections so that the question of the Brexit can be solved.

“If the government is unable to get its agreement approved, there should be a general election as soon as possible,” he said in a speech yesterday. Next January 15 a key vote will take place in the British Parliament, which will allow to verify if the deputies support the plan of the Brexit agreed between London and Brussels last November.

If not, May will have less than a week to propose a plan B and try to count on the support of the Chamber again. If it fails, all options are open, including a Brexit without agreement and an early general election.