Bentley has become the latest carmaker to warn that failure to reach a Brexit deal would hurt its sales and ability to invest, and would lead to a temporary shutdown of its factory in Crewe, Cheshire.
Adrian Hallmark, the chief executive of the luxury carmaker, told Reuters it was stockpiling some components ahead of Brexit and switching from the port of Dover to Immingham to bring in certain parts. The Volkswagen-owned marque makes about 11,000 cars a year in Crewe.
If London and Brussels fail to reach an agreement by the end of the year, Bentley may stockpile more components and close its factory for a few extra days, said Hallmark, who joined Bentley from Jaguar Land Rover in February. The majority of key components including engines and body come from the European Union, mainly Germany.
“We may work for four days, or we may have a longer Christmas break and a longer Easter break if there is no deal so that we can smooth the period between now and the middle of next year,” Hallmark said.
Britain’s largely foreign-owned carmakers worry about the prospect of tariffs (10% for cars and car parts under World Trade Organization rules) and delays to imports of components. More than half (56%) of parts come from abroad, the majority (79%) from the EU, according to trade body the Society of Motor Manufacturers and Traders.
“Best case, it’s an annoying impact on our annual profitability,” Hallmark said. “Worst case, it’s quite damaging on our annual profitability so a full no-deal Brexit would hurt us as a company, it would limit ability to invest.”
Jaguar Land Rover, Britain’s biggest car manufacturer, warned last month that tens of thousands of jobs in the sector could be lost, and that a hard Brexit would cost the company £1.2bn a year, wiping out profits.
Aston Martin has started stockpiling engines in preparation for Brexit, and is reportedly considering flying in car components if motorways to and from Dover get blocked.
A Bentley spokesman said this was also an option for Bentley, although the firm has no such plans at the moment. “Everything is under consideration at this stage.”
The comments came as Bentley slipped deeper into the red. It sold 6,654 vehicles in the first three quarters of this year, down from 7,498 a year earlier. Sales revenues fell to €1.1bn (£980m) from €1.3bn and its operating loss widened to €137m from €31m, due to exchange rate effects and delays in the launch of the new Continental GT model.