Commercial

Airbus Threatens UK Pull-Out in the Event of a No-Deal Brexit

By Nick Zazulia | January 25, 2019
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Photo by Natalie Behring, courtesy of By World Economic Forum

Airbus CEO Tom Enders (Natalie Behring/World Economic Forum)

Airbus Chief Executive Tom Enders delivered a scathing rebuke to proponents of a no-deal Brexit Thursday, even threatening the manufacturer's eventual abandonment of the United Kingdom.

"Please don’t listen to the Brexiteers’ madness, which asserts that because we have huge plants here, we will not move and we will always be here," Enders said in a video released online Jan. 24. "They are wrong."

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The U.K. is one of the four founding nations of the European Airbus consortium, and every wing on a commercial Airbus aircraft is made there. Airbus has a 14,000-person workforce across 25 sites in the UK, supporting roughly 110,000 jobs and contributing more than $10 billion to the British economy, according to company figures. But the company is not happy with the way Brexit is dragging on, and Enders said "plenty of other countries would love to build the wings for Airbus aircraft."

If the U.K. were to leave the EU without a deal, it would immediately leave the European Single Market, the Customs Union and European Court of Justice jurisdiction. EASA regulations would no longer apply and U.K. companies would no longer be EASA-certified. In a risk assessment, Airbus projected that a no-deal Brexit could cost the company more than $1 billion per week in disruptions until those frictions were ironed out.

"It is a disgrace that more than two years after the result of the 2016 referendum, businesses are still unable to plan properly for the future," Enders said.

He acknowledged that the European planemaker could not simply pick up and move immediately, but threatened to "redirect future investments in the event of a no-deal Brexit," saying that aerospace is a long-term business and Airbus is "not dependent on the U.K." for its future.

The U.K. is legally committed to leaving the European Union at the end of the Month, and Parliament rejected Prime Minister Theresa May's most recent proposed Brexit deal. May has lost a great deal of support in the British government, and, while much of Parliament opposes a no-deal Brexit, there is difficulty coming to any sort of agreement on a deal with the clock winding down.

That may be what spurred the Airbus CEO to hold the U.K.'s feet to the fire, leveraging the company's economic impact to encourage a deal.

"Brexit is threatening to destroy a century of development based on education, research and human capital. If there is a no-deal Brexit, we at Airbus will have to make potentially very harmful decisions for the U.K.," Enders said.

"Airbus will survive and thrive whatever the outcome. The question is, does the U.K. wish to be a part of that future success?"

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