January 26, 2021
The two other post-Brexit scenarios look at Britain
"It is inevitable that we would face increasing and higher tariffs, making our
products less competitive in Europe," he said in a copy of the letter seen by
Reuters.JLR fully funds its investments without support from parent Tata Motors,
executives have said. JLR, which is owned by owned by India's Tata Motors, sold
almost a quarter of its over 520,000 cars in its largest market Europe last
year, confirmed it had looked into the impact of Brexit."It may at worst cost us
about 1 billion pounds," said one of the sources when asked how Jaguar Land
Rover (JLR) had phrased the wording in the 89-page report, entitled 'Referendum:
The View'. Some projects have been put on hold until the outcome of the
referendum is clear, according to the sources.The rapidly-expanding firm, which
traces its history back to 1922 and is headquartered in Coventry, central
England, has also looked into opening a European office were Britain to quit the
bloc, both sources said.6 billion pounds.It opened a small overseas facility in
Brazil last week.A second source said the number had featured in an internal
presentation shown to the board.The 1 billion pound decline in pre-tax profit by
2020 would apply if Britain returned to World Trade Organisation rules for trade
with Europe, involving a 10 per cent tariff on exports and an inbound tariff of
roughly 4 percent on components, the sources said.."They are deeply worried
about being outside of the EU. However, a hit to profit could impact the
company's ability to fund further expansion."Having an office close to Brussels
would allow them to maintain influence post any deal," the second source
said.The worst-case-scenario estimate is in internal documents seen by both
sources that were prepared by the firm's chief economist, David Rea, to outline
the possible consequences if Britons vote to leave the world's biggest trading
bloc in Thursday's referendum.In December, JLR sealed a deal to build a
1-billion pound plant in Slovakia with an annual output of 300,000 cars partly
in a bid to help it better deal with fluctuations in the value of sterling.
But
the sources said construction of the factory, which could become vital for JLR's
European businesses if a vote for Brexit brought new trade tariffs, has yet to
start.JLR, which is owned by owned by India's Tata Motors sold almost a quarter
of its over 520,000 cars in its largest market Europe last year."As part of our
standard business planning process, we regularly look at macro-economic and
geo-political developments around the world," a JLR spokesman said in an emailed
statement.European officeJLR could open an office in Brussels were Britain to
leave the EU to maintain influence with European policymakers, both sources
said, with the first source saying Luxembourg was also an option. The company
made a 2015/16 pre-tax profit of 1.It has also put on hold China
End face Cylindrical Grinding Machine Manufacturers starting major work on a
plant in Slovakia announced in December as well as negotiations on a deal to
lease property at Silverstone race track because of the uncertainty surrounding
Thursday's vote, they said.It gives an insight into the level of concern at a
major company about the uncertainties of a future outside the EU.CEO Ralph
Speth, who has consistently spoken out in favour of continued EU membership,
wrote to workers on Monday warning of the possible consequences of a Brexit on
the firm."JLR is Britain's biggest builder of high-end and premium models and is
one of the many small and premium automakers benefiting from more lenient EU
rules including on emissions, due to low sales volumes compared to mass
manufacturers.
The two other post-Brexit scenarios look at Britain taking several
years to negotiate a deal to remain in the single market or agreeing a trade
deal imposing low tariffs costing JLR in the low hundreds of millions, the
source said..6 million cars last year, is undergoing a major expansion of its
lineup, and has joined the rest of the overwhelmingly foreign-owned car industry
in calling on Britons to remain in the bloc.That source said JLR could make the
office its European headquarters but the second source said JLR would retain its
British HQ.The sources also said a decision on Silverstone had been delayed
until after the referendum.JLR, which built nearly one in three of Britain's
1.'Leave' campaigners argue that Britain should be able to negotiate a
tariff-less trade with France and Germany for its cars because French and German
models are so popular with British drivers."Businesses have been reluctant to
talk about contingency plans for Brexit but carmaker Ford, which only builds
engines in Britain, said it could face tariffs of 2.They have been holding off
on meaningful expenditure," the second source said. However, we are not
discussing details of any internal business analysis.A hit to JLR would be a big
blow to Britain's resurgent car industry, which has been lauded by politicians
as a sign of the country's manufacturing prowess and is on course to reach an
all-time production high of nearly 2 million cars by 2020.47 billion) by the end
of the decade if Britain leaves the European Union, according to two sources
familiar with the company's thinking.Deeply WorriedThe work, which has been
updated several times since it was first prepared for the board with input from
the company's sales, marketing and tax departments last summer, features three
other scenarios including Britain remaining in the single market, the second
source said.. London: Jaguar Land Rover, Britain's biggest carmaker, estimates
its annual profit could be cut by 1 billion pounds ($1. The cost of investment
contributed to a 40 per cent decline in its 2015/16 pre-tax profit.A spokesman
at the firm said: "Jaguar Land Rover is a British company and our headquarters
will remain in the UK.7 per cent on engine exports and import tariffs of up to
10 per cent on incoming vehicles, according to a copy of a letter sent to
employees on Monday seen by Reuters."Like any other responsible global business,
we have analysed the impact of any potential UK departure from the EU
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