BMW will bring forward the 2019 summer maintenance shut down at its Mini factory in Oxford to 1 April – just after the UK is expected to ‘Brexit’ (leave the EU) at the end of March.
The automaker reportedly said the plan was to minimise disruption in case of a ‘no deal’ outcome, telling the BBC it wanted to reduce any “possible short-term parts-supply disruption”.
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“While we believe this worst case scenario is an unlikely outcome, we have to plan for it,” BMW added.
The Cowley plant (once a Pressed Steel body plant supplying the long ago demolished Morris/Austin Rover complex across the road) would remain open in April with maintenance, management and catering staff continuing to work despite no cars being made, the BBC reported.
BMW said downtime would be used to start preparing the plant to make the new electric Mini.
Automakers are concerned the UK leaving the EU without a deal on 29 March would result in disruption at the borders and shortages of parts as the country changes to WTO trading terms.
Hundreds of lorries a day arrive at Cowley with parts from across the world, with 60% of components coming from the EU, hence the automakers have experience of sourcing parts from outside the bloc though supply chains may have to be lengthened for parts from those countries.
“What BMW has done is simply reschedule [the] shutdown to coincide with a potential period of serious disruption at the borders after Brexit, if we leave the EU without a deal. If the plant is not actually making cars, then a shortage of imported parts should not be so much of a problem. The company says a no-deal outcome is unlikely, but has to be planned for,” a BBC analyst wrote.
World Trade Organization tariffs under a no-deal scenario would add a 10% import duty cost to parts currently sourced tariff-free from the EU.
Sky News noted that, during the Leave/Remain referendum campaign, a number of high profile Leave campaigners claimed an exit deal with the EU was inevitable because BMW would lobby German chancellor Angela Merkel for one.
David Davis, later Brexit secretary (minister), claimed in February 2016 the UK was “too valuable a market for Europe to shut off”.
“Within minutes of a vote for Brexit the CEOs of Mercedes, BMW, VW and Audi will be knocking down Chancellor Merkel’s door demanding that there be no barriers to German access to the British market.”
But the development shows BMW revealing how disruptive it expects a no-deal to be, and its lack of faith in a deal being reached, Sky News said.
BMW and the UK car industry together have long warned the UK government of the Brexit threat stressing the no-deal impact to “just in time” supply chains.
There have been claims a no-deal Brexit would make the channel tunnel so congested it would effectively be blocked for two weeks while a further two weeks of emergency diplomacy between the UK government and the EU to re-establish the rules for some form of free flowing trade are also expected after a no-deal exit from the EU.
A BMW spokesperson told Sky News: “Planned annual maintenance periods at BMW Group production sites allow essential updating and equipment replacement to be completed over several weeks, while there is no production taking place.
“As a responsible organisation, we have scheduled next year’s annual maintenance period at Mini Plant Oxford to start on 1 April, when the UK exits the EU, to minimise the risk of any possible short-term parts-supply disruption in the event of a no-deal Brexit.”
“We remain committed to our operations in Britain, which is the only country in the world where we manufacture for all three of our automotive brands.”
BMW also final assembles Rolls-Royce cars, presses Mini body panels and builds BMW and Mini engines at three other plants in England.
