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Brexit, the economy and house prices part 5
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Some nations have no car manufacturing industry, Australia comes to mind for instance....
Now, it doesn't. Two years ago it did.
https://www.autocar.co.uk/car-news/industry/end-car-production-australia-what-went-wrongThe loss of car manufacturing will be a hit a clear net negative.
Why?
Are you aware of the theory of comparative advantage?0 -
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The loss of car manufacturing will be a hit a clear net negative. You could try to argue Brexit could mean other net positives to offset this negative but you can not make the silly argument that if a car factory closes other UK car factories will just ramp up production because that wont happen.
What leads you to think that the physical part of car production will not shift to China or cheaper long term?
It's clear that car producers will entertain all options, if it achieves cost reduction. I don't think Ford switched engine production to Turkey for any alignment of ideology with Erdogan!
We used to produce motor bikes at one time. We produced televisions. We produced mass hifi. We had a large pottery industry. A lot of this has gone, a lot of which has happened whilst we have been in the EU.
Being in the EU is no great protector long term.0 -
What leads you to think that the physical part of car production will not shift to China or cheaper long term?
It's clear that car producers will entertain all options, if it achieves cost reduction. I don't think Ford switched engine production to Turkey for any alignment of ideology with Erdogan!
We used to produce motor bikes at one time. We produced televisions. We produced mass hifi. We had a large pottery industry. A lot of this has gone, a lot of which has happened whilst we have been in the EU.
Being in the EU is no great protector long term.
Presumably the likes of Nissan chose the UK because we were inside the single market and customs union, are you suggesting that is not the case?'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
Are you aware of the theory of comparative advantage?
Are you aware of the theory of supply and demand? If a car factory shuts down due to the supply being too great for the market demand, then why would the competitor ramp up production to replace it?
It might mean that it becomes worthwhile for the last man standing to keep making cars here, although it depends on what the cost of running the factory is compared to the cost of importing cars from outside the UK.Presumably the likes of Nissan chose the UK because we were inside the single market and customs union, are you suggesting that is not the case?
I thought they chose the UK specifically because the government bribed them by overriding planning laws and let them build their factory on otherwise worthless green belt land. But of course they only considered us because we were in the EU. But that is all to do with tariffs and quotas. If they can get a high enough quota and the savings of building elsewhere outweigh the tariff, then they could build elsewhere.
If the UK isn't a large enough market to operate a factory in and they are going to be hit with the same quota and tariff whether the car comes from china or the EU, then UK cars could be built in china.A lot of this has gone, a lot of which has happened whilst we have been in the EU.
Being in the EU is no great protector long term.
That is specious reasoning https://www.youtube.com/watch?v=fm2W0sq9ddU
I could just as easily say that the industries would have closed earlier and more industries followed if we weren't in the EU. You won't believe that because of your preconceived idea about the EU, but it's equally probable0 -
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That is specious reasoning https://www.youtube.com/watch?v=fm2W0sq9ddU
I could just as easily say that the industries would have closed earlier and more industries followed if we weren't in the EU. You won't believe that because of your preconceived idea about the EU, but it's equally probable
How is it specious.
For some, the vote to Leave was clearly a misdirected complaint against globalism, that seems obvious to me.
You can look at vox pop sentiment from regions in the UK; heart land USA; or Greece/Italy/Spain etc. You will get common complaints, and it all boils down to people struggling to adapt to a changing world.
Labour follows capital now, and capital moves wherever it can find a good return. Even Germany shifted parts production to Eastern Europe for it's auto makers.
Will Brexit fix things? Obviously not. I've just come back from the Far East, and I reckon there are more opportunities out there, until it all goes a bit pear of course.0 -
Presumably the likes of Nissan chose the UK because we were inside the single market and customs union, are you suggesting that is not the case?
Indeed.
Maybe you'd like to make a prediction on where Nissan will be in 20/30 years time.
I'm not looking at past decisions here, I'm trying to look at the future long term direction.
The big hope is that the value in auto moves from the tin box to the network, once self drive is a reality.0 -
Presumably the likes of Nissan chose the UK because we were inside the single market and customs union, are you suggesting that is not the case?
Different times back in 1984. The Berlin Wall didn't even fall until 1989. Nor was manufacturing being transferred out to China, India and Mexico.0 -
What leads you to think that the physical part of car production will not shift to China or cheaper long term?
It's clear that car producers will entertain all options, if it achieves cost reduction. I don't think Ford switched engine production to Turkey for any alignment of ideology with Erdogan!
We used to produce motor bikes at one time. We produced televisions. We produced mass hifi. We had a large pottery industry. A lot of this has gone, a lot of which has happened whilst we have been in the EU.
Being in the EU is no great protector long term.
Indeed. I read the other day that the EU recently 'approved the sale of a British company to Apple'. What business this is of the EU, I don't know. It is up to British politicians to approve such things and to take responsibility for decisions like this, not some remote foreign unelected bureaucrat sitting in Brussels.0 -
Indeed. I read the other day that the EU recently 'approved the sale of a British company to Apple'. What business this is of the EU, I don't know. It is up to British politicians to approve such things and to take responsibility for decisions like this, not some remote foreign unelected bureaucrat sitting in Brussels.
Likewise there's no possibility of Apple repatriating manufacturing back to the US on any scale. Cost base just isn't comparable with China. Post GFC has shifted the power eastwards. The West has to become cheaper to compete.0
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