When Brexit nonsense hits manufacturing reality

A Brexit manufacturing timeline.

May 2016

Professor Patrick Minford, of Economists for Brexit, says of manufacturing:

Over time, if we left the EU, it seems likely that we would mostly eliminate manufacturing, leaving mainly industries such as design, marketing and hi-tech. But this shouldn’t scare us.

Transitional arrangements should be made, lasting around 10 years, to help industries such as car manufacturing adjust.

June 2016

Mid-Derbyshire MP Pauline Latham, writing in the Derby Telegraph, explains why she wants to leave the EU:

At the weekend I made up my mind that Britain will be better off leaving the European Union. It is a decision that I have not arrived at easily, having been genuinely undecided since the referendum was announced.

Our manufacturing sector ranks number eight worldwide. The language we speak, English, is the international business language. Our judicial system is consistently rated as one of the least corrupt anywhere and our contract law is regarded across the world as the best for business. We have a long history of innovation, especially here in Derbyshire from even before the industrial revolution.

… Britain has a proud history and we want our children and grandchildren to enjoy the chances and opportunities we have had. I think this is possible outside of the EU and we should be confident that Britain can once again can stand by itself.

(This article has been removed since it was published, but fortunately I kept a copy).

March 2019

Johan van Zyl, head of Toyota’s European operations, speaking at the Geneva Motor Show to the BBC:

Mr van Zyl said it was vital that there was frictionless trade with the European Union.

He said Toyota would overcome any short-term problems at its Burnaston car plant near Derby, such as logistics, caused by leaving without a deal. But preparation for no-deal has been costly, he said, and in the long-term things could be “very difficult”.

Could work at Burnaston dry up after the current production cycle comes to an end? “The long-term effect could be that if it [Brexit] is very negative, that outcome is possible.”

Constantly improving competitiveness is vital, he said, adding: “But if the hurdles are becoming so high that you cannot achieve it then of course you can’t avoid it [hitting investment].”

Many people probably remember Minford’s comment about exiting the EU “mostly eliminating manufacturing”. It’s easier to forget that he was also arguing for a 10 year transition period prior to the referendum. One presumes he must be horrified by the negative consequences of a no-deal Brexit with no transition period. If so, he seems to be keeping very quiet about it.

As for my MP, Pauline Latham, she clearly forgot about a key reason why UK manufacturing was performing so well in 2016. The frictionless trade provided by the EU single market and customs union and required by Toyota to make sense of their investment here. Had that fact not slipped her mind, I’m sure she wouldn’t have advised her constituents to vote to leave. Surely? It wouldn’t have been rational, given the difficulty she found in making her decision.

We may be at the eleventh hour and 58th minute before Brexit, but if Latham is a genuine champion of manufacturing in Derby, she needs to take Minford’s advice. Rather than the no-deal desired by her ERG colleagues, she must vote for an extension to Article 50. That way, her government may stand an outside chance of obtaining Minford’s 10 year transition period.

Alternatively, she could recognise that she was poorly advised in June 2016 by the Brexiter elite. It would be the mark of a principled politician to acknowledge that, after all, EU membership provides the best chance of giving our children and grandchildren the opportunities we’ve enjoyed since 1973. Voting to revoke Article 50 would be a start to repairing the damage of the last two years.

The chickens are coming home to roost. Waiting for a disastrous Brexit.
The chickens are coming home to roost. Waiting for a disastrous Brexit.

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Reader Comments

  1. Andrew Morrish

    The twist of time and management of history even in the short term example you quote is shocking.
    Honda and Swindon are a little closer to home for me and the positives of a highly skilled, motivated, engaged and continuously improving workforce with great local infrastructure are assets not to be overlooked; but they are wasting assets. Finding alternative sustainable industrial and manufacturing output for those great attributes to be applied to remains an option now, but it won’t be for long unless a blend of effective sustainable industrial strategy and quality investment and entrepreneurship are brought together in a seamless transition over the coming 2-3 years with support from Honda.
    A UK prosperous future founded solely on services (even if that is solely an economic definition based on things that don’t hit you on the foot when you drop them) fills me with dread – what does that mean in a world of machine learning and declining UK educational engagement? There is much to be said for capital used equitably for sustainable social gain as per the Spanish Mondragon model, and I desperately hope that we can find a way to embrace our strengths and build on them, rather the put a finger in the wind and hope we’ll be all right. Whatever the outcome Brexit needs to be a catalyst for real depth of sustainable strategy for our islands in a 21st century context.

Your thoughts?