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NEWS ADMIN

DATE

13/03/2019

NEWS PROVIDER

Nur Aisha Abd. Wahab

NEWS SOURCE

Forbes

CATEGORY

HEADLINE

No-Deal Brexit Would Decimate Britain's Auto Industry, Or Maybe Not

Forbes (12/03/2019) - Debt rating experts Moody’s Investors Service and consultants Fitch Solutions have ventured into dangerous territory; trying to predict the impact on the British auto industry if the nation left the European Union without a deal.

Moody’s puts forward some detailed and disastrous predictions for automakers in Britain like Nissan, Honda, Toyota and Jaguar Land Rover (JLR). Fitch goes into less corporate detail but has some big political predictions. Given that nobody in British political life has the faintest idea of how the saga will end, that is very brave. Moody’s did make clear after questioning that its predictions are aimed at the unlikely event of a “no-deal” lasting more than a few days before solid arrangements are in place.

Prime Minister Theresa May faces a vote Tuesday which is likely to lead to the defeat of her E.U. Withdrawal Agreement. That will be followed later this week with a vote seeking to reject “no-deal”, and another one on extending the treaty – Article 50 – that brings Britain’s EU membership to an end on March 29.

Britain’s parliament has already voted to leave the EU on March 29, so if you had to guess the most likely outcome, it would be this; leaving, without a deal. This “no-deal” scenario has cranked up some horrendous theories, and Moody’s and Fitch grab hold of the worst ones. And they are not alone.

The auto industry has also signed up to some hysterical, damaging versions of the implications of Brexit. If there’s no deal, trade with the EU immediately comes to a halt as trucks block ports around Britain and northern France. When the traffic finally clears a bit, tariffs will be slapped on trade which will ruin the auto industry because of its need for smooth, uninterrupted supply chains. Before too long, all the big auto manufacturers in Britain will shut down, causing huge unemployment and economic carnage.

Read more at https://www.forbes.com/sites/neilwinton/2019/03/12/no-deal-brexit-would-decimate-britains-auto-industry-or-maybe-not/#5da59781defa