NEWS
05/07/2018 08:39 BST | Updated 05/07/2018 15:13 BST

Jaguar Land Rover Warns That 'Bad' Brexit Deal Threatens £80bn Of UK Investment

The Government has been accused of playing 'Russian roulette' with tens of thousands of jobs.

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Ralf Speth, chief executive officer of Jaguar Land Rover, has warned of the impact a 'bad' Brexit deal would have on the UK's largest car manufacturer.

Jaguar Land Rover has warned that a “bad” Brexit deal would severely hit its profits and will threaten plans to invest £80bn in the UK over the next five years.

Unions have accused the Government of playing “Russian roulette” with tens of thousands of jobs after the UK’s biggest carmaker said “greater certainty” was needed on Brexit.

Dr Ralf Speth, chief executive of JLR, owned by India’s Tata Motors, said the “wrong outcome” in the negotiations to leave the European Union could jeapordise the company’s future investment in the UK.

Meanwhile the GMB Union said losing JLR would be an “economic car crash”. 

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The unions said losing JLR would be an 'economic car crash'. 

More than 40,000 workers are employed by the car manufacturer in the UK, with a further 260,000 jobs in the UK supply chain.

Len McCluskey, general secretary of Unite the Union, said: “Tens of thousands of decent jobs... are being put at risk by a Government that places its survival, indulging narrow, extremist views, above the well-being of the people of this country. This is simply not acceptable.

“So I say this to the Tory party, our jobs are not yours to play Russian roulette with. Drop your red lines and secure a decent deal, one that is to the benefit of the working people of this country.

“And if you cannot agree to put people before your ideology then move over and let a party that will get on with it.”

Stuart Richards, GMB senior organiser, said: “The Government is still spending more time squabbling with each other rather than listen to real warnings from industry.

“Our members at Jaguar Land Rover do skilled jobs with decent pay and contribute millions to the real economy.

“We cannot afford to lose Jaguar Land Rover and its supply chain - it would be an economic car crash.”

He added: “This Government needs to start thinking of the lives of Britain’s workers – and their families – rather than internal Tory party bickering.”

The news follows similar statements from BMW and Airbus – and comes ahead of a crucial meeting of the Cabinet on Friday to finalise a White Paper on Brexit.

Speth said the company’s “heart and soul was in the UK” and the “wrong outcome” could jeapordise future investment.

He said: “We, and our partners in the supply chain, face an unpredictable future if the Brexit negotiations do not maintain free and frictionless trade with the EU and unrestricted access to the single market.

“We urgently need greater certainty to continue to invest heavily in the UK and safeguard our suppliers, customers and 40,000 British-based employees.

“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 in the next five.

“This would be in jeopardy should we be faced with the wrong outcome.

“For more than 250 years, since the era of Adam Smith, Britain has championed free markets and made the case for free trade.

“If the UK automotive industry is to remain globally competitive and protect 300,000 jobs in Jaguar Land Rover and our supply chain, we must retain tariff and customs-free access to trade and talent with no change to current EU regulations.”

Speth added: “Electrification and connectivity offer significant economic and productivity opportunities – get Brexit wrong and British people, businesses and broader society lose the chance to lead in smart mobility.”

In 2017 the company sold 621,000 cars, with 80% of them going to 130 countries.

One in three cars exported from the UK are Jaguars or Land Rovers.

Mainland Europe is one of JLR’s largest markets, with 20% of cars being sold there.

In the current financial year JLR intends to invest £4.5bn, with more than half going into development of new vehicle models and technologies.

Jaguar Land Rover’s UK tax contribution exceeds £2bn a year.