Airbus says no-deal Brexit would threaten its role in UK
* Airbus says needs clarity on post-Brexit terms
* Businesses voicing concerns two years after vote
* Airbus has 14,000 employees in Britain
(Adds UK government response, further Airbus comments)
By Tim Hepher and Paul Sandle
PARIS/LONDON, June 22 (Reuters) - Airbus issued its
strongest warning yet over the impact of Britain's departure
from the European Union, saying a withdrawal without a deal
would force it to reconsider its long-term position and put
thousands of British jobs at risk.
In a memorandum issued late on Thursday, Airbus said current
plans for a transition period ending in December 2020 were still
too short for the European planemaker to adapt its supply chain
and would prevent it from expanding its British supplier base.
Airbus, which makes wings for all its passenger jets in
Britain, said that leaving both the EU's single market and
customs union immediately and without any agreed transition
would lead to "severe disruption and interruption" of
"Put simply, a no-deal scenario directly threatens Airbus'
future in the UK," said Tom Williams, chief operating officer of
Airbus Commercial Aircraft.
Two years on from the Brexit vote, businesses are starting
to speak out over uncertainty about the trading and regulatory
environment once Britain leaves the EU next March.
Echoing calls from Germany's Siemens earlier this
week, Airbus said it needed immediate details on how its
operations would have to be organised.
Airbus in total supports 100,000 jobs in Britain, with
14,000 people directly employed by the company, Williams said.
Airbus said it could not make decisions about new investment
in Britain, including in its next generation of wings, without a
clear Brexit deal.
"We have to come to the point where we have to make
decisions, and quite often those decisions are long term in
nature, and without clarity then it's too dangerous for us to
proceed," Williams told BBC radio on Friday.
"When we look at the next generation of wings, which is
called 'Wing of the Future', we are working on that today in
development in the UK and clearly now we are seriously
considering whether we should continue that development or find
Airbus builds wings at a state-of-the-art plant in
Broughton, north Wales.
A British government spokeswoman said: "We have made
significant progress towards agreeing a deep and special
partnership with the EU to ensure trade remains as free and
frictionless as possible, including in the aerospace sector, and
we're confident of getting a good deal that is mutually
"Given the good progress that we are continuing to make in
the negotiations we do not expect a no-deal scenario to arise."
Airbus, however, is already beginning to press the button on
its crisis actions, for example concerning its supply chain.
In a document setting out risks linked to Brexit, the
company said it would need a 1-billion-euro extra stockpile of
parts to cope with extra disruption. It warned in March that it
would need to build up a special buffer stock.
Industry analysts say Airbus would be unlikely to pull out
of Britain abruptly because of long lead times and a
waiting-list of up to eight years for its planes.
But there is already expected to be competition to build
wings for the next generation of single-aisle jets, whose
development could begin around the middle of next decade.
Germany, Spain or emerging aerospace suppliers such as South
Korea are seen as possible candidates to take work.
Airbus says it buys 16 percent of its parts from Britain. A
significant share of this spending goes on parts that could not
readily be shifted, such as Rolls-Royce engines. But the
company says it may rein in new spending in the country.
Prime Minister Theresa May won a crucial Brexit vote in
parliament on Wednesday, keeping her divided government's plans
to end more than 40 years of British partnership with the
European Union on track.
However, talks with the bloc have all but stalled, with
May's top team of ministers at odds over plans for future
trading relations with the EU. Businesses complain that makes
them unable to plan their investment decisions.
(Reporting by Tim Hepher and Paul Sandle
Editing by Leslie Adler and Keith Weir)
First Published: 2018-06-22 00:55:22
Updated 2018-06-22 11:16:50
© 2018 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.