Features

Honda closes factory – is Brexit to blame?

Brexit and global manufacturing trends are proving to be a double whammy for car factory workers in Britain.

935-Honda-634

Brexit adds a "go-slower" stripe

"For at least a year, bodies such as the Confederation of British Industry (CBI) and manufacturers' association the EEF and the British Chambers of Commerce (BCC) have been telling ministers that the uncertainty caused byBrexit would have serious consequences," says Larry Elliott in The Guardian.

So the news that 3,500 jobs will be lost when Honda closes its Swindon plant by 2022 "will make the employers' organisations even more insistent that a no-deal outcome should be ruled out". Brexit isn't the only factor, but it "played its part", as shown by Japanese lobbying for a softer Brexit. Honda's decision will "add to the already considerable pressure on Theresa May".

Those blaming Brexit "should listen to what the company has to say", says Ross Clark in The Daily Telegraph. Not only has it explicitly denied a link between the two, but it has said that "it is also closing a plant in Turkey, and will not be shifting any production to EU countries". Honda would have closed its Swindon plant, Brexit or no Brexit. Indeed, you could even argue that European pledges to phase out petrol and diesel cars by 2040 have left the industry in "a huge state of flux".

Still, leaving the EU won't make it easier to encourage further investment from car companies to replace the lost jobs, says Liam Proud of Reuters. More than half of UK-assembled cars are shipped to the continent and "a post-Brexit immigration crackdown" will make it harder to find skilled workers, "something the UK car industry already struggles with, judging by the sector's 5,000 unfilled vacancies". Last year saw inward investment in new production capacity fall by half. Brexit will give the UK's car industry a "go-slower stripe its workers will hardly appreciate".

Recommended

How to prepare your business for Brexit
Small business

How to prepare your business for Brexit

Whether we have a Brexit deal or not, new procedures for importers and exporters will apply from 1 January. Get your business ready now.
27 Nov 2020
Brexit begins: what do the UK and the EU want from a trade deal?
Brexit

Brexit begins: what do the UK and the EU want from a trade deal?

With Brexit now done, the trade talks can begin. But who wants what from a UK/EU trade deal, and how likely are they to get it?
3 Feb 2020
Inflation is the easiest way out of this – just don’t expect politicians to admit it
Inflation

Inflation is the easiest way out of this – just don’t expect politicians to admit it

The UK government borrowed £34.1bn in December, a record amount for that month. Britain's debt pile now amounts to 100% of GDP. How are we going to pa…
22 Jan 2021
Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021

Most Popular

The FTSE 100 is set for a makeover with an influx of new tech stocks
UK stockmarkets

The FTSE 100 is set for a makeover with an influx of new tech stocks

The FTSE 100 – the dullest index in the world – is about to reinvent itself as a host of new firms list on the market. The change is long overdue, say…
24 Jan 2021
Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021
Think Tesla is a bubble? This might be the best way to bet on it bursting
Oil

Think Tesla is a bubble? This might be the best way to bet on it bursting

The huge rise in Tesla’s share price means that, by market value, it’s now the sixth-largest company in the US and and the world’s biggest car-maker. …
25 Jan 2021