The chief executive of Philips has shared his Brexit concerns, saying the lack of progress could force the firm to rethink UK operations.
Frans van Houten warned that the Dutch health-technology manufacturer said it might have to change the entire supply chain to limit impacts from when the UK crashes out of the EU.
“As time passes and there is no solution I get increasingly worried that hereafter frictionless trade between the United Kingdom and European mainland could be at risk,” he said.
“Basically the UK as a manufacturing hub for the world would be at risk.”
On Monday, Philips released disappointing quarterly results. The group posted €4.3 billion (£3.8 billion) in sales, a 4% growth.
Shares fell 8% to €31.30, the lowest point since April.
The boss said that a no-deal or hard Brexit would affect production at the Philips’ main UK exporting plant, which is in Glemsford.
“We are looking at a customs union as a minimum (requirement),” he told reporters. “If that were not to happen we would need to rethink our manufacturing footprint.”
Van Houten also expressed concerns surrounding the trade war, which has the potential to knock €60 million off profits next year.
“We will redesign some of our supply chains,” he said.
“We are in the good position of having factories in the United States, in Europe and in Asia. We can rebalance those going forward in order to avoid some of the duty impact.”
