BMW makes contingency plans for hard Brexit as negotiations drag on

(qlmbusinessnews.com via news.sky.com– Tue, 2nd Oct 2018) London, Uk – –

The UK is the German car industry's fourth largest market and BMW insists it remains of “strategic importance”.

German car giant BMW has told Sky News it is making contingency plans for “all scenarios” when Britain leaves the European Union – including “a hard complicated Brexit”.

The company sells around 50,000 cars a year in the UK, which is BMW's fourth-biggest market after China, the United States and Germany.

But BMW has been critical of preparations for Brexit, and those criticisms are now intensifying.

Speaking to me at the Paris Motor Show, where BMW is unveiling it crucial new 3-series model, the firm's chief financial officer Nicolas Peter seemed exasperated when we spoke about Brexit.

He said: “Are we disappointed with the progress [of Brexit negotiations] so far? Yes we are, so we have to prepare for all different scenarios, including a hard, complicated Brexit where supply chains will be impacted for a couple of weeks.

“We have many, many parts that have to move every day from the UK to Europe, and the other way. When Brexit happens, we will need to examine the impact, and analyse the rules and regulations for a company like ours.”

Mini, which is owned by BMW, recently confirmed that the date of its annual factory shutdown would be moved to the start of April, to coincide with the weeks after the United Kingdom leaves the European Union.

Mr Peter said the UK remained a country with “strategic importance” to BMW, but said the prospect of Brexit was already causing “tension in the UK car market”.

He also claimed that an ad-hoc agreement, allowing Britain to adopt the regulations of the World Trade Organisation, but to offer a bespoke , zero-tariff deal to European car makers, was all but impossible.

“We do not believe this is realistic,” said Mr Peter. “The legal consideration is much more complicated.”

By Adam Parsons