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3 April 2019

Brexit No-deal Threat from Ford

Unbelievably, despite not building any cars in the UK, Ford still has the most employees, but not for long it seems.  Ford employees are concentrated in Dagenham and South Wales, where they are machining and assembling engines for their own cars assembled in Cologne and Ghent, and for certain cars in the PSA group and other smaller customers.  These facilities are referred to under the codename ‘Gemini’.

Generally, these engines are small advanced diesels co-designed with PSA and the falling popularity of diesel has already affected production levels - the adverse effects of a no-deal Brexit are almost certain to increase unit cost and therefore reduce production levels.  Both PSA and Ford have available production capacity within the EU and it is very likely both companies have already calculated reduced unit production costs in those existing factories - or maybe even elsewhere within the EU or at the Transit plant in Turkey.

We already know that the other major car assembly ‘trans-plants’ are under varying degrees of threat for future continuation.  This would include Toyota, Honda and Nissan.  Jaguar-Land Rover plants may also be under threat as their American and East European plants come on stream and consideration is given to increasing sales and manufacturing in the Far East.

We must not forget that while these UK trans-plants directly employ a large range of skilled and semi-skilled workers, their supply chain employs - it is estimated - approximately 3 to 4 times that number of staff, plus often giving after-sales support.