MercoPress. South Atlantic News Agency

Jaguar-Land Rover warns about a “bad” Brexit for profits and investment

Jaguar Land Rover chief executive Ralf Speth said: ”A bad Brexit deal would cost Jaguar Land Rover more than £1.2bn profit each year.

Jaguar Land Rover has warned that a “bad” Brexit deal would hit its profits and threaten its £ 80bn investment plans. The UK's biggest carmaker, owned by India's Tata Motors, said its “heart and soul is in the UK”.

 But without frictionless trade its UK investment plans would be in “jeopardy”. The warning came as Downing Street set out detail of a possible post-Brexit customs arrangement.

Jaguar Land Rover chief executive Ralf Speth said: “A bad Brexit deal would cost Jaguar Land Rover more than £1.2bn profit each year.

”As a result, we would have to drastically adjust our spending profile; we have spent around £50bn in the UK in the past five years - with plans for a further £80bn more in the next five. “This would be in jeopardy should we be faced with the wrong outcome.”

Mr Speth said the firm “urgently need[s] greater certainty to continue to invest heavily in the UK”. The car maker has about 40,000 UK-based employees.

Separately, in a letter to Prime Minister Theresa May and EU chief negotiator Michel Barnier, the British Retail Consortium (BRC) warned that a lack of frictionless trade would see customs delays for perishable goods.

“Failure to reach a deal - the cliff edge scenario - will mean new border controls and multiple 'non-tariff barriers', through regulatory checks, that will create delays, waste and failed deliveries,” the BRC said.

“The consequences of this will be dramatic for UK consumers. It is likely that we will see food rotting at ports, reducing the choice and quality of what is available to consumers.”

However, Brexit campaigner Patrick Minford, chair of Economists for Free Trade, said a tariff-free trade deal was achievable. “JLR understandably wants tariff-free trade to continue with the EU after Brexit. So does everybody and this would be achieved once we leave the EU by a straightforward Canada-type, CETA, trade deal.

”There is much nonsense talked about non-tariff barriers and border costs under such a deal.

“These would be illegal. Both the UK and the EU must continue under WTO rules to apply current standards in a non-discriminatory way.”

And Business Secretary Greg Clark said the government was “determined” to make sure JLR could “continue to prosper and invest in Britain”.

The Jaguar Land Rover warning follows similar statements from BMW and Airbus. After those warnings in June, Health Secretary Jeremy Hunt said the threats were “completely inappropriate”