The shock of potentially departing from the European Union has started impacting heavily on the car industry in the United Kingdom. Vauxhall has cut a lot of jobs and Jaguar Land Rover has also revealed plans of reducing its production due to the uncertainty of Diesel caused by the Brexit. The worse fear of union bosses is that this may only be the beginning.
Many people in the industry also believe that this may be only the starting of a huge chain of disruptions that will be triggered by the United Kingdom’s vote to leave the European Union. With the separation from the European Union tariffs and other hurdles that arise in regular trade could be a disastrous factor that may disrupt the car manufacturers greatly. This is because parts of a car move across multiple borders several times during the process of manufacturing.
Take the manufacturing routine of BMW Mini as an example. The crankshaft for the engine is manufactured in France, which is then shipped to BMW’s UK Engine Plant Hams Hall located near Birmingham. Then that shaft is moved to Austria for engine assembly, which is then again moved to Oxford.
This is a very serious situation where the trading relation of the UK with other countries may never remain as it is right now. All of this free transportation around the borders, Tariff-free manufacturing and a lot of other vital factors are at stake as the UK government tries to figure out the kind of trading relationship it wants with the other countries of Europe after this massive departure.
Between all this, The Labor Party (funded by the unions that are hard on protecting jobs in the industrial sectors in the UK) that voted heavily for Brexit are also trying to figure the kind of deal that the UK should strike with other countries of Europe if Brexit is finalized and the United Kingdom takes its lead from the EU.