A no-deal Brexit would value German carmaker BMW “tons of of thousands and thousands” of euros, with elevated tariffs handed on to customers within the UK and continental Europe, the group’s chief monetary officer warned on Wednesday.
Nicolas Peter stated the premium producer, which produces Mini fashions in Oxford, had “plans [for price increases] within the drawer” that may take impact if no settlement was reached by the top of the 12 months.
However he stated the Munich-based firm was assured it could not should shut its Oxford plant within the speedy aftermath of a no-deal Brexit, as a result of BMW had stockpiled elements.
“Technically we’re ready,” Mr Peter stated. “We now have the power to move automobiles and components even in a no-deal situation.”
BMW’s UK manufacturing facility produces greater than 220,000 Minis per 12 months, and is a giant employer within the space.
The manager stated elevated customs checks wouldn’t be the most important problem to BMW’s British enterprise, and the corporate would “be on high of the logistics in a short time”.
“However there will probably be a ten per cent tariff on automobiles,” he warned, “and that may have a unfavorable impact [on BMW] within the mid-three-digit-million euro vary per 12 months”.
This “substantial” hit to earnings wouldn’t be wholly swallowed by the group, which might “go on increased prices”, Mr Peter added. “Minis in Europe and BMWs in UK will probably be costlier,” he confirmed, however didn’t present additional particulars on the extent of any enhance.
German automobile producers’ publicity to Britain has fallen sharply in recent times, with simply 590,000 automobiles exported to the nation in 2019, down from 810,000 in 2015, in keeping with business lobbyists, the VDA. Nevertheless, the UK is the fourth-largest marketplace for BMW.
Whereas he stated it was too early to inform whether or not no-deal tariffs would have an effect on the long-term way forward for the Oxford plant, Mr Peter stated BMW was “flexibly positioned” when it got here to Mini manufacturing.
The corporate additionally had choices to develop manufacturing in Germany and China, he stated, the place it’s creating an electrical model of the automobile.
The group, which additionally owns Rolls-Royce, not too long ago introduced it could transfer some Mini manufacturing from the Netherlands to Leipzig, in Germany.
Mr Peter stated that BMW was “not concerned” in negotiations between the EU and UK, however hoped “that in the long run an affordable answer will probably be discovered”.