cb25
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Post by cb25 on Feb 18, 2019 16:57:25 GMT
May not be Brexit, as article states:
"The EU and Japan recently struck a trade deal which lowers tariffs on both parties' car exports to zero.
James Atwood, deputy editor of Autocar magazine, said this could be a big factor behind Honda's decision.
"It allows Honda to produce their cars in Japan where most of their plants are and then ship them to the EU without having to pay the import tariffs they have been, which does reduce one of the reasons for needing a plant in the UK," he told BBC News.
BBC business editor Simon Jack says the trade deal certainly "means a dwindling rationale to base manufacturing inside the EU".
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registerme
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Post by registerme on Feb 18, 2019 17:02:29 GMT
May not be Brexit, as article states:
"The EU and Japan recently struck a trade deal which lowers tariffs on both parties' car exports to zero.
James Atwood, deputy editor of Autocar magazine, said this could be a big factor behind Honda's decision.
"It allows Honda to produce their cars in Japan where most of their plants are and then ship them to the EU without having to pay the import tariffs they have been, which does reduce one of the reasons for needing a plant in the UK," he told BBC News.
BBC business editor Simon Jack says the trade deal certainly "means a dwindling rationale to base manufacturing inside the EU".
Eh? As a result of Brexit the UK doesn't benefit from the recently signed EU Japan trade deal. Had we remained in the EU Honda's calculus would have to have been different. How is it not then, at least in part, "Brexit related"?
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cb25
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Post by cb25 on Feb 18, 2019 17:05:51 GMT
May not be Brexit, as article states:
"The EU and Japan recently struck a trade deal which lowers tariffs on both parties' car exports to zero.
James Atwood, deputy editor of Autocar magazine, said this could be a big factor behind Honda's decision.
"It allows Honda to produce their cars in Japan where most of their plants are and then ship them to the EU without having to pay the import tariffs they have been, which does reduce one of the reasons for needing a plant in the UK," he told BBC News.
BBC business editor Simon Jack says the trade deal certainly "means a dwindling rationale to base manufacturing inside the EU".
Eh? As a result of Brexit the UK doesn't benefit from the recently signed EU Japan trade deal. Had we remained in the EU Honda's calculus would have to have been different. How is it not then, at least in part, "Brexit related"? Simon Jack's comment "means a dwindling rationale to base manufacturing inside the EU" would seem to suggest it could well have happened even if we'd been intending to stay in the EU
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registerme
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Post by registerme on Feb 18, 2019 17:12:53 GMT
Yeah that I don't disagree with. But I think that suggesting that Brexit was no part of the consideration is a stretch to far.
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james100
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Post by james100 on Feb 18, 2019 17:38:17 GMT
The Japanese government said this would happen as a result of Brexit. The entire UK car industry said it would happen as a result of Brexit. Even Brexit’s lead economist Prof Patrick Minford on UK car industry stated it would be run down as a result of Brexit "... in the same way we ran down the coal industry and steel industry. These things happen.”
The only surprise is the surprise.
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Post by bracknellboy on Feb 18, 2019 17:38:39 GMT
I think wise to at least to wait and see what Honda themselves have to say on this before any hard judgements. Regardless though, there are many things that contribute to these decisions. When weighing up one side of the balance against the other, it doesn't necessarily take that much to tip the scales.
There are considerable costs that come with closing a manufacturing plant and moving elsewhere. That is one of the things that would have weighed against the decision. On the other hand, the UK is moving from a position of being inside the EU regime and therefore not subject to tarrifs, to being outside. Meanwhile Japan has signed a trade agreement with the EU. So what was a positive and at worst became a neutral (long term) as a result of Jpn-EU deal, has shifted to being a negative and a highly uncertain one at that. That has to be a fact: how much it may have counted is of course debabateble.
But if you are looking to cut or consolidate capacity, these things matter.
what was also said in those BBC feeds was:
"But having said all that, Japanese companies are very long-term investors. In the mid-1980s, Margaret Thatcher championed the UK as the perfect outpost for Japanese carmakers looking for access to European markets." ...
"Sony and Panasonic moved their European headquarters to the EU. In each case, the rationale was slightly different. But many in Japan feel failure to provide Brexit certainty have loosened the ties that used to bind the two countries."
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Post by bracknellboy on Feb 18, 2019 17:54:31 GMT
"In a tweet, Mr Tomlinson said: "Honda are clear this is based on global trends and not Brexit, as all European market production will consolidate in Japan in 2021."
So not really anything relevant here.
That presumably is Justin Tomlinson, Conservative MP for North Swindon, who as it happens campaigned to Leave the EU. The thought "he would say that wouldn't he" strangely comes to mind
Edit: Oh, the statement also suffers from a slight lack of critical analysis/logical deduction:
"...and not Brexit, as all European market production will consolidate in Japan in 2021".
It IS their only current plant in the EU. De facto closing it land moving to Japan leads to all European production to consolidate in Japan. You can't then claim that outcome as evidence that it had nothing to do with Brexit. (whether it did or didn't). Logical nonsense.
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delboy
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Post by delboy on Feb 18, 2019 18:21:13 GMT
Perhaps I’m missing something, but if having a foothold in the EU (i.e the UK) is so critical, surely the intention should be to relocate to somewhere in the EU (ie not Japan)?
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cb25
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Post by cb25 on Feb 18, 2019 18:23:10 GMT
-Brexit -Japan/EU trade deal -CPTPP trade deal ("All of these members have promised to eliminate their tariffs on car imports") -demise of diesel -Trump ("Donald Trump has not backed down on threats to slap potentially crippling tariffs of up to 25pc on imported EU cars")
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Post by bracknellboy on Feb 18, 2019 18:35:26 GMT
-Brexit -Japan/EU trade deal -CPTPP trade deal ("All of these members have promised to eliminate their tariffs on car imports") -demise of diesel -Trump ("Donald Trump has not backed down on threats to slap potentially crippling tariffs of up to 25pc on imported EU cars")
well I guess we can probably dismiss both of the bolded points. Of Honda UK Swindon production, 90% is exported to the EU. I would expect that the other 10% was for UK market. Honda has substantial manufacturing operations inside the US. They dwarf the UK operations and european market for them.
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IFISAcava
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Post by IFISAcava on Feb 18, 2019 18:37:21 GMT
You can either argue that each of the decisions to relocate some or all production or resources out of the UK - Sony, Panasonic, Nissan, Honda, BlackRock, JPMorgan Chase, Bank of America, Citigroup, Deutsche Bank, Goldman Sachs, Unilever, Schaeffler, etc etc - is not necessarily or even mostly related to Brexit.
Or you can put it together and see a pattern.
I hereby propose the 5 stages of Brexiteers coming to terms with the losses of Brexit (with apologies to Kubler-Ross)
First, it isn't going to happen (it's all Project Fear) - Denial Second, now that it is starting to happen, it would have happened anyway - Anger Third, well, I always knew it would happen and it's a price worth paying for xxx (insert choice of sovereignty, borders, free movement, deregulation etc) - Bargaining Fourth, well, we have to go through some turbulence before we can reach the sunlit uplands - Working Through Fifth, acknowledgement that Brexit has't worked - Acceptance
The problem is that I don't think there is anything that could happen that will get Brexiteers to the 5th stage. Instead, it will be replaced by - "it wasn't done properly, if only we'd done (x, y, z) instead" - and it will joint the list of failed pure ideologies that litter the history of humankind.
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IFISAcava
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Post by IFISAcava on Feb 18, 2019 18:42:47 GMT
Perhaps I’m missing something, but if having a foothold in the EU (i.e the UK) is so critical, surely the intention should be to relocate to somewhere in the EU (ie not Japan)? They already have a foothold in Japan, surely easier to move production there than set up completely new works in the EU. If you think the prospect of export tariffs, or disruption of just in time production models, or anger at the breaking of the UK's previous promises (very important to the Japanese), or uncertainty (even if we agree something, what's to say it won't change again?) played no role in this decision, I think you're deceiving yourself.
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cb25
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Post by cb25 on Feb 18, 2019 18:44:26 GMT
Possibly time. Ask me in about 10 years.
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IFISAcava
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Post by IFISAcava on Feb 18, 2019 18:46:05 GMT
Possibly time. Ask me in about 10 years. deal! (though I might also ask occasionally before then...)
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Godanubis
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Anubis is known as the god of death and is the oldest and most popular of ancient Egyptian deities.
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Post by Godanubis on Feb 18, 2019 18:49:57 GMT
Perhaps I’m missing something, but if having a foothold in the EU (i.e the UK) is so critical, surely the intention should be to relocate to somewhere in the EU (ie not Japan)? They already have a foothold in Japan, surely easier to move production there than set up completely new works in the EU. If you think the prospect of export tariffs, or disruption of just in time production models, or anger at the breaking of the UK's previous promises (very important to the Japanese), or uncertainty (even if we agree something, what's to say it won't change again?) played no role in this decision, I think you're deceiving yourself. Since Japan has just agreed a 0% tariff deal with EU it does not matter where the plant is and Far east and Australian markets probably are greater than EU.
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