No-deal Brexit will cost Derbyshire’s Toyota factory ‘millions’, top boss warns

A no-deal Brexit could result in “stop-start production” for weeks or months at Toyota’s UK car plant at a cost of millions of pounds, an executive at the Japanese motor giant has warned. Tony Walker, deputy managing director of Toyota Europe, made the comments at a House of Commons Business Select Committee meeting, held earlier today. Toyota’s Derbyshire factory at Burnaston exports the majority of the cars it makes to mainland Europe and is soon to start building a brand new model, the all-new Corolla.

But Mr Walker told the committee that UK consumers could pay a “significant” price for any deviation from EU standards and regulations following Brexit.

The new Toyota Corolla hatchback and Touring Sports both of which will be built at Burnaston

He said: “If we go out of line with the EU in the future, some areas wouldn’t be so expensive, but some areas would be very expensive. “If we were to have different emissions regulations, the cost would be huge and that cost would be passed on to the market, so the UK consumer would pay for the additional R&D (research and development) costs.” Mr Walker also warned that a no-deal Brexit could seriously impact production at Burnaston.

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He said: “We run integrated just-in-time European supply chains, we have 50 trucks a day coming through the (Channel) Tunnel, we carry just four hours of parts at the plant and collect the parts in sequence to the build.

“We have to have not just 50 trucks a day, but we have to have them in sequence. It’s no good if we have 49 and truck 17 is missing. We would then stop.

“Without the Withdrawal Agreement, withdrawing with no deal, we would have stop-start production for weeks, possibly months. It would be very, very difficult for us to cope with.

No-deal Brexit will cost Derbyshire’s Toyota factory ‘millions’, top boss warnsProduction at Toyota’s Burnaston factory could be disrupted in the event of a no-deal Brexit

“The value of the cars we make is GBP10 million a day. If you lose that value, it’s very challenging for us.”

Mr Walker told the committee that Toyota “absolutely” welcomed Theresa May’s Withdrawal Agreement, largely because it provides a 21-month transition period during which companies can prepare for new arrangements. Also giving evidence to the committee was Sydney Nash, senior policy manager at the Society of Motor Manufacturers and Traders (SMMT). He said Brexit uncertainty was a factor behind a 50% drop in automotive investment in the UK over the last year and an expected 115,000 reduction in vehicles produced next year.

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Moving to World Trade Organisation (WTO) tariffs under a no-deal scenario would add around GBP4.5 billion to the cost of imports and exports, Mr Nash said.

He added: “No deal is not something that could be easily managed. It would have a serious impact on us in terms of our productivity, competitiveness and ultimately jobs.”

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