JAGUAR Land Rover will be “better off” after Brexit because the company will have access to cheaper car parts from across the globe, said Brexiteer MP Owen Paterson.
Brexit news: Tory MP Owen Paterson said Jaguar will have access to cheaper parts after Brexit
Jaguar Land Rover willhave access to cheaperparts and componentsall around the worldOwen Paterson
Jaguar Land Rover (JLR) is the latest company to issue warnings about a no deal Brexit. The firm warned investment plans for the UK worth £80billion would be threatened by a bad Brexit deal.
But the Brexiteer MP shut down claims and said the UK's biggest car firm will thrive after Brexit.
Speaking on BBC Radio 4’s Today
Programme, Mr Paterson said: “What is really vital is that they will be
better off if the Government delivers on what the Prime Minister
promised me in the Commons yesterday if we really do leave the customs
union.
“It’s really important this, Jaguar Land Rover will have access to cheaper parts and components all around the world.
“And
the European suppliers currently will be forced to compete or they will
lose Jaguar Land Rover’s business. All the studies show the car trade
is very robust at the moment, it is profitable and that will continue.”
Dr
Ralf Speth, chief executive of JLR, warned a no deal Brexit would
result in the firm leaving the UK because of an expected £1.2 billion
surge in tariff costs.
But Mr Paterson said the a no deal Brexit
would not result in tariffs on British goods. He said: “I think what
they’re saying is no deal automatically means tariffs - it doesn’t.
“If we go to World Trade terms, we decide our tariffs. We can have zero tariffs.
“If
you look at studies of the car trade it’s robustly competitive and
profitable at the moment and that will continue because we have had a
significant devaluation, which is a lot more than the tariffs anyway.”
He
added: “The latest WTO trade facilitation agreement insists that both
sides must have a seamless, i.e. effectively computerised, as now for
the rest of the world, procedure, which are effectively costless.”
But
Jaguar Land Rover chief executive Ralf Speth said: “A bad Brexit deal
would cost Jaguar Land Rover more than £1.2bn profit each year.
"As
a result, we would have to drastically adjust our spending profile; we
have spent around £50bn in the UK in the past five years - with plans
for a further £80bn more in the next five.
"This would be in jeopardy should we be faced with the wrong outcome.”
Mr Speth said JLR "urgently need greater certainty to continue to invest heavily in the UK".
The
JLR boss told the Financial Times: "If I'm forced to go out because we
don't have the right deal, then we have to close plants here in the UK
and it will be very, very sad.
"This is hypothetical, and I hope it's an option we never have to go for."
Jaguar Land Rover has been contacted for comment.
Mr Speth’s comments follow similar warnings from Airbus.
In
a statement in June, Airbus, which employs 14,000 people in Wales,
claimed that no deal would "lead to severe disruption and interruption
of UK production".
Dr Ralf Speth, chief executive of JLR, warned a no deal Brexit would result in the firm leaving the UK because of an expected £1.2 billion surge in tariff costs.
But Mr Paterson said the a no deal Brexit would not result in tariffs on British goods. He said: “I think what they’re saying is no deal automatically means tariffs - it doesn’t.
“If we go to World Trade terms, we decide our tariffs. We can have zero tariffs.
He added: “The latest WTO trade facilitation agreement insists that both sides must have a seamless, i.e. effectively computerised, as now for the rest of the world, procedure, which are effectively costless.”
But Jaguar Land Rover chief executive Ralf Speth said: “A bad Brexit deal would cost Jaguar Land Rover more than £1.2bn profit each year.
"As a result, we would have to drastically adjust our spending profile; we have spent around £50bn in the UK in the past five years - with plans for a further £80bn more in the next five.
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