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Cars Brexit could force Japanese carmakers out of Britain

15:10  13 february  2018
15:10  13 february  2018 Source:   autoexpress.co.uk

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The post- Brexit future of Japanese carmakers in the UK has been called into question by Japan ’s ambassador following a high-level Downing Street summit. © Auto Express Bad Brexit deal could see cars pulled from UK showrooms.

The post- Brexit future of Japanese carmakers in the UK has been called into question by Japan ’s ambassador following a high-level Downing Street summit.

Nissan Sunderland © Auto Express Nissan Sunderland

The post-Brexit future of Japanese carmakers in the UK has been called into question by Japan’s ambassador following a high-level Downing Street summit.

Speaking outside 10 Downing Street shortly after a meeting of 19 Japanese industry leaders, the country’s ambassador, Koji Tsuruoka, called Brexit a “high stakes” situation, emphasising the importance of the “continuation of healthy, sound trade relations between [the] UK and [the] EU”.

Tsuruoka warned if favourable post-Brexit trade agreements with the UK and EU were not agreed, Japanese companies were likely to leave the UK.

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The post- Brexit future of Japanese carmakers in the UK has been called into question by Japan ’s ambassador following a high-level Downing Street summit. Japanese carmakers employ thousands of workers in the UK.

If parts from mainland Europe are likely to be held up in customs queues following Brexit , carmakers will need to adjust their UK operations, whether by building larger warehouses in Britain , or trying to use more domestic component suppliers.

“The question is whether the arrangements that will be reached between the two sides will allow the Japanese companies to continue to operate in the UK," he said.

Bad Brexit deal could see cars pulled from UK showrooms © Auto Express Bad Brexit deal could see cars pulled from UK showrooms

Addressing Japan’s status as a “major investor” in the UK and the EU, Tsuruoka said the continuation of this was dependent upon business cases: "If there is no profitability of continuing operations in the UK - not Japanese only - no private company can continue operations. So, it is as simple as that."

Japanese carmakers employ thousands of workers in the UK. Nissan’s Sunderland plant currently has around 7,000 staff, while Honda has roughly 3,000 at Swindon.

A similar number of Toyota staff build hundreds of thousands of cars and engines at Burnaston in Derbyshire, and Deeside in North Wales. With roughly 80 per cent of cars built in the UK exported, however, favourable trade links are vital for these operations.

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Economist Jacob Funk Kirkegaard told my colleague Timothy B. Lee that right now UK carmakers can pretty safely assume But as my colleagues point out , the EU might not be in a forgiving mood, given that Britain just voted to leave. Britain ’s departure could have ripple effects throughout Europe, too.

There are growing fears that Britain could be headed for a so-called "cliff-edge" Meanwhile, Tokyo's ambassador to Britain warned that Japanese businesses might pull out of Britain if they faced higher costs after Brexit . Carmakers Nissan, Honda and Toyota produce almost half of Britain 's cars

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