Carmaker Ford (NYSE:F) has warned that a hard Brexit might cost it up to £615 million in 2019 alone in an exclusive statement to Sky News.
Ford issued a statement to Sky on Thursday, where a spokesperson outlined:
“Our planning assumptions for Brexit include a negotiated exit as the most likely outcome, with a transition period during 2019 and 2020 if the withdrawal package is approved by UK parliament.”
“However, we recognise that the situation is highly uncertain, and are monitoring events closely. In the event of a no-deal scenario the resulting border friction, deteriorating economic outlook, coupled with likely further sterling devaluation, and introduction of WTO tariffs would severely impact Ford’s operations in the UK and across Europe and could potentially result in an $800m headwind in 2019.”
According to information obtained by Sky News, the carmaker has privately calculated the economic risk that a hard Brexit may cause for its business.
In October last year, the group’s European boss, Steven Armstrong, warned that a no-deal Brexit could be “pretty disastrous” for its UK operations. Today we have learnt just how much that disaster will cost for the first year alone of a hard exit from the European Union.
With significant parliamentary chaos unravelling in the first four weeks of the year alone, a departure from the European Union without a deal that can command support in Parliament is looking ever more likely. In fact, it is highly probable that Brexit could lead to another recession.
Ford isn’t the only car manufacturer to warn against a hard Brexit. Jaguar Land Rover’s boss, Ralf Speth, warned Theresa May that UK factories risk huge job cuts if she does not “get the right deal” prior to the nation’s departure.
The motor vehicle sector is not alone in expressing its concerns. Just yesterday luxury fashion brand Burberry (LON:BRBY) warned that “the biggest concern is the disruption to the supply chain”, chief operating and financial officer Julie Brown commented.