Airbus warns no-deal Brexit is a ‘lose-lose situation’

Incoming CEO said company would need to evaluate the long-term impact of Brexit before deciding the future of its British facilities

Airbus is calling on its suppliers across Europe to stockpile one month of parts and components destined for factories in the U.K. to mitigate the impact of a no-deal Brexit, Guillaume Faury, the company’s incoming CEO, told POLITICO Wednesday.

“We have asked our suppliers impacted in going across the Channel to have buffer stocks of one month,” said Faury. “But we don’t know how long it could last.”

The company employs 14,000 people at 25 sites in the U.K., including 6,000 at an aircraft wing factory in Wales.

“The first priority for us is that a no-deal Brexit cannot happen,” said Faury, who takes over from current CEO Tom Enders next month. “This is uncharted territory and a big risk for the industry … It’s a lose-lose situation for many people, but still, this is the world we live in.”

Faury said neither side of the Channel had taken “appropriate action” to ensure an orderly Brexit. “It has to be joint work and preparation, that is not the case.”

He called on France, Belgium, Germany and the Netherlands to ramp up preparations in the event of the U.K. crashing out of the EU with no agreement at the end of this month.

Faury said Airbus would need to evaluate the long-term impact of Brexit before deciding the future of its British facilities. “We will not move our wing factories overnight,” he said. “We are happy with the workforce and skills we have over there and we strongly rely on them for the short-term.”


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Airbus warns of ‘catastrophic’ no-deal Brexit

Company has spent ‘tens of millions of euros’ preparing for UK’s exit from the EU.

A top Airbus executive warned today that a no-deal Brexit would be “catastrophic” for the industry, adding that the company has already spent tens of millions of euros preparing for such a scenario.

“There is no such thing as a managed ‘no deal’, it’s absolutely catastrophic for us,” Airbus’ Senior Vice President Katherine Bennett told the BBC’s Andrew Marr show.

“Some difficult decisions will have to be made if there’s no deal … We will have to look at future investments,” she added.

Airbus employs 14,000 people across the U.K. Asked where Airbus would relocate production in such a situation, Bennett said that “there’s many other countries that dearly love aerospace.”

She said the company already spent “tens of millions of euros” preparing for Brexit, including a no-deal scenario, by stockpiling parts, securing IT systems and figuring out employees’ future travel arrangements.

The company has a backlog of orders for 9,000 aircraft, Bennett said, which means it would be “many, many years” before U.K. employees would be affected in case the company decides to relocate.


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Science minister quits over Brexit deal as UK ends Galileo talks

Negotiation ‘stacked against us from the very beginning,’ says Sam Gyimah.

U.K. Science Minister Sam Gyimah quit late Friday over Prime Minister Theresa May’s Brexit deal, after the government pulled out of “frustrating” talks on the EU’s Galileo satellite navigation system which offered “only a foretaste of things to come.”

Gyimah, who served in the Education Department and did not have Cabinet rank, is the seventh minister to quit since May presented the Brexit deal negotiated by the British government and the EU to Cabinet two weeks ago. He said he would vote against the agreement in the House of Commons.

The government on Friday abandoned efforts to remain within the satellite project and is likely to forego the £1.2 billion it has already invested in the scheme.

“After careful consideration and reflection, I cannot support the Government’s deal and as such, I have tended my resignation as Universities and Science Minister,” Gyimah, who voted Remain in the EU referendum, said in a Facebook post.

“The government is finally pulling out of frustrating negotiations over Galileo, the EU’s strategic Satellite Navigation system. The PM is right to call time on a negotiation that was stacked against us from the very beginning. But Galileo is only a foretaste of what’s to come under the Government’s Brexit deal,” he said.

“Having surrendered our voice, our vote and our veto, we will have to rely on the ‘best endeavours’ of the EU to strike a final agreement that works in our national interest. As Minister with the responsibility for space technology I have seen first-hand the EU stack the deck against us time and time again, even while the ink was drying on the transition deal,” Gyimah said.


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In so many areas the EU’s negotiating stance is sadly defined by the politics of punishment, rather than economics

The news that Boeing has just opened a £40 million manufacturing facility in Sheffield to make parts for their latest 737 and 767 aircraft, which are assembled in the United States, serves to remind us that our world-class aerospace business is global and to torpedo the claims of Airbus – and some car manufacturers – […]

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The news that Boeing has just opened a £40 million manufacturing facility in Sheffield to make parts for their latest 737 and 767 aircraft, which are assembled in the United States, serves to remind us that our world-class aerospace business is global and to torpedo the claims of Airbus – and some car manufacturers – that Brexit will threaten jobs in the UK because it will cause havoc to the just-in-time manufacturing process. Boeing’s plans call for the production of 52 aircraft a month with thousands of parts being shipped every month to Portland, Oregon, so timely delivery will be just as critical to Boeing as it is to Airbus.

So, the question arises: if Boeing can operate a slick production process using parts made in Britain, shipped six times the distance to their assembly line compared to shipping Airbus parts from Bristol or North Wales to Hamburg or Toulouse (and BAE ship 15% of every single F35 Joint Strike Fighter to the Lockheed Martin plant in Dallas), what is Airbus’s problem? The answer lies not in economics but in politics.

As is increasingly clear, despite protestations to the contrary, elements of the EU really do want to punish the UK for having had the insolence to Leave and to deter other countries from following our lead. France seems to be the most determined to press for punishment, partly to try to seize the City of London’s business and partly to promote President Macron as the new EU leader as Angela Merkel’s grip weakens.

Recently there were reports, subsequently denied, that President Macron intended to require UK visitors to France to obtain visas whilst those Brits with homes in France would immediately upon Brexit become illegal visitors. Apparently, the word ‘not’ was omitted in translation and the proposed new law designed to prevent such action. However, Dominic Raab subsequently spoke about the possibility of France ‘deliberately’ delaying lorries entering the port of Calais.

Earlier this year, the EU announced the creation of a fund to develop new defence equipment, a programme from which the UK, home to Europe’s largest defence contractor and with the largest defence budget in Europe, was to be excluded. Furthermore, the UK is to be ejected from key parts of the EU satellite navigation programme, Galileo, despite having contributed £1.2 billion and constituting, through Airbus subsidiary Surrey Satellites, a key portion of the technology. Any reasonable person would ask where was the commercial, let alone defence, interest in excluding such a major European player. Again, the answer lies not in economics but in politics: the UK has to be punished even if it means damaging the defence interests of the continent.

As we approach the sombre commemorations of the centenary of the 1918 armistice which ended The Great War, it is worth pausing to reflect on the role of some of those nations who, in the famous words of Margaret Thatcher, ‘we either rescued or defeated’.  The British people have voted freely but decisively to Leave the EU, yet face punitive measures by some on the continent for whose liberation in two world wars this country and its Empire shed 1,300,000 lives. Whilst falling over themselves to secure favourable trade deals with the rest of the world, the EU’s leaders have adopted the reverse policy with their closest neighbour, refusing to discuss trade arrangements before sorting out an artificial problem of their creation by weaponising the Irish border, a clear solution to which has been proposed by the ERG and others.

In another example of the pathetic approach in Brussels, I understand that the EU’s aviation safety agency, EASA, is debarred from discussing with our CAA how we manage air travel post Brexit.  Given the UK’s prominence in air transport, with Heathrow being the most important transatlantic gateway airport in Europe, why is EASA not engaged in constructive debate? Iceland, Norway and Switzerland are members of EASA even though they are not EU members, so why remove the UK? Again, the answer lies in politics, not economics. They want to cause inconvenience, if not chaos, to rub home to the others the cost of recovering national sovereignty.

All this illustrates the fundamental naivety exhibited by the UK at the outset of the negotiations, namely that if we conceded and acted in a friendly fashion the EU would respond in similar vein, leading many Leave voters to question the motives of those in charge. We never acknowledged the determination of the Commission to protect The Project (to create the United States of Europe) and we failed to recognise the strength of the cards in our hands.

So we threw away the security card, offering unconditional support to the 27, only to be rewarded by exclusion from EU defence programmes. The Prime Minister offered to pay a staggering £39 billion of our money in return for – nothing. Well, if she thinks British taxpayers will tolerate that, I fear she is mistaken. I can no longer withhold my vote in Parliament, but I can withhold my taxes unless I see a fair trade deal is secured.

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