No-deal Brexit ‘is threat to UK aerospace industry’
Britain’s aerospace industry would lose investment and suffer from supply-chain problems in the wake of a no-deal Brexit, according to a new report.
The Institution of Mechanical Engineers (IMechE) found that the movement of skilled workers, access to engineering resources and the freedom to trade with customers, group companies and suppliers across the EU are key factors behind decisions to invest in the UK aerospace sector.
The UK aerospace industry generated £35bn in turnover in 2017, with £30bn in revenue from exports which grew 39 per cent between 2012 and 2017 the IMechE report states.
The sector employs over 120,000 people, many in highly skilled engineering roles.
“The effect of Brexit and a “no-deal” scenario would be felt in the long run and would impact future investment decisions,” said the report, titled ‘UK Aerospace: The Impact of Brexit’.
The industry, which is highly specialised and dominated by multinational companies, depends heavily on participation in European and global supply chains.
If the UK leaves the EU without an appropriate deal in place, then aerospace companies will face supply chain disruption and higher manufacturing costs if imports from the EU are subject to tariffs and restrictions.
If restrictions are placed on the movement of people and goods, these will create logistical problems for many companies due to a lack of readiness, as well as the cost and delay resulting from additional customs and immigration checks.
These factors will increase the time it takes to manufacture products, raise operating costs and hamper the UK sector’s global competitiveness, the study concluded.
“It is important that the UK aerospace industry is able to maintain its high value manufacturing, world-leading research and growing international trade without disruption,” said Colin Brown, Chief Executive of the Institution.
Automakers with manufacturing facilities in the UK have also taken action in recent weeks over concerns that a deal with the EU will not be achieved before 29 March.
Both Rolls-Royce and Aston Martin recently triggered Brexit contingency plans over concerns that they might have difficulties acquiring components following a “disorderly” Brexit.
A vote on whether to accept UK Prime Minister Theresa May’s Brexit deal is going to happen tomorrow, although it is thought that the deal will not be accepted by MPs, posing the risk of a possible no-deal scenario.
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