No-deal Brexit would cost Honda tens of millions of pounds, car maker warns

Japanese motor giant employs 4,000 people at Swindon branch, where Civic model is produced

A no-deal Brexit would cost Honda tens of millions of pounds and make it more difficult to bring necessary parts from Europe into the UK, the car maker has warned.

The company said, however, it remains committed to its Swindon operation, which employs 4,000 people.

The group uses millions of parts sourced from other EU countries at the Swindon plant, where the Civic is manufactured, and said a no-deal Brexit would create a “significant” burden in terms of bringing parts into the country, as well as delivering cars to the rest of Europe.

Ian Howells, Honda Europe’s senior vice president, told the BBC: “We’d probably be looking at something like 60,000 additional bits of documentation we would have to provide to get products to and from Europe.”

He added: “If we end up with WTO tariffs, we’d have something like 10 per cent costs in addition to our shipped product back into Europe and that’d certainly run into tens of millions.

“And likewise when we’re looking at componentry coming the other way, again tens of millions in terms of tariffs potentially coming into the UK.”

This would have an impact on productivity and competitiveness, Mr Howells said, particularly up against European rivals.

However, the Swindon plant is the only place where the Civic is produced, so it would be a “very big decision to take a different approach”.

“Really it hasn’t come up that we would actually have to look at putting Swindon elsewhere,” he said. “The logistics of moving a factory the size of Swindon would be huge and as far as we’re concerned, we’re right behind supporting continued production at Swindon.”

The Honda executive’s remarks follow Jaguar Land Rover’s decision to move workers at its Castle Bromwich plant to a three-day week because of “continuing headwinds impacting the car industry”.

Ralf Speth, Jaguar’s boss, last week warned that tens of thousands of jobs in the UK motor industry are at risk if a no-deal Brexit goes ahead.

He also said the current lack of clarity around Brexit means he does not know if his plants will be able to function after 29 March 2019, and added that interruptions to production could cost up to £60m a day.