Tata Motors-owned Jaguar Land Rover (JLR) joined other major businesses in the U.K. in offering a stark message on the need for certainty as it warned that a bad Brexit deal could cost the company more than £1.2 billion profit each year, putting £80 billion of further investment and jobs at risk.
“If the U.K. automotive industry is to remain globally competitive and protect 3,00,000 jobs in Jaguar Land Rover and our supply chain, we must retain tariff and customs-free access to trade and talent with no change to current EU regulations,” CEO Ralf Speth said late on Wednesday. Mr. Speth warned that JLR and its supply chain partners faced an “unpredictable future” if Brexit negotiations did not maintain “free and frictionless trade” with the EU and unrestricted access to the single market. A “bad Brexit deal” would force the firm to “drastically adjust” its spending profile, which had led to £50 billion of investment in the past five years, and included plans for a further £80 billion over the next five. “This would be in jeopardy should we be faced with the wrong outcome.”
The warning came ahead of a cabinet summit on Brexit at Chequers, the Prime Minister’s country retreat, at which Theresa May will attempt to rally support for her plans for a final Brexit deal ahead of a meeting with EU leaders. The message was seized on by those concerned about the direction of Brexit negotiations.
‘Not idle threat’
“For people in manufacturing towns and cities, this is not a joke or an idle threat. We are talking about the loss of hundreds of thousands of jobs with a devastating impact for our economy,” said Alison McGovern, MP, who supports the “People’s Vote” campaign for a second referendum on the final Brexit deal. Len McCluskey, general secretary of the U.K.’s biggest union Unite, called on the government to stop playing “Russian roulette” with people’s jobs and livelihoods. “Drop your redlines and secure a decent deal, one that is to the benefit of the working people,” he urged.
On Thursday, the government sought to reassure the firm. “JLR is a great British success story,” said Britain’s Business, Energy and Industrial Strategy Minister Greg Clark, considered one of the cabinet members pushing for a softer Brexit. “We are determined to make sure that it can continue to prosper and invest in Britain.”
From cautionary messages in the immediate aftermath of the referendum, global businesses in the U.K. have grown increasing vocal and frank in their assessment of Brexit’s potential impact. Airbus and BMW are among firms that have warned that their presence in the U.K. was at risk.
In recent months, JLR has announced the shifting of production of its Land Rover Discovery to a plant in Slovakia and 1,000 job losses.