Brexit the economy and house prices part 7: Brexit Harder

SouthLondonUser

Thrugelmir wrote: »

Then why close the plant in Turkey. Only last October production was going to ramped up.

I don't know. Do you?


Are cars produced in Turkey exempt from any tariffs (real question, not rhetorical)?


Why move production to Japan if that means paying tariffs for at least a few years?


Are the other EU countries worried that the other Japanese plants in the EU might suffer the same fate?

phillw

SouthLondonUser wrote: »

Why move production to Japan if that means paying tariffs for at least a few years?

The Japanese car companies have a lot of experience of Japan and how to do business in Japan and how much it costs in Japan & they already have factories there to handle some of the production.

They would have to build factories in Turkey, build up a work force from scratch, get to know how to manage turkish people etc. It's probably not worth it for a few years.

Once brexit happened and their trade deal came in then it was obvious they'd just build in Japan anyway and slowly each company seems to be announcing that. The government tried to convince them that we'd do a great trade deal with the EU, but time has run out.

SouthLondonUser wrote: »

Are the other EU countries worried that the other Japanese plants in the EU might suffer the same fate?

That is always the danger of doing free trade deals, but I don't think the EU is going to be giving them enough of a reason to make a decision quickly. Shipping a finished car from Japan to EU is a pain compared to shipping raw materials and parts, the main problem would be if people stop buying the cars in the EU.

SouthLondonUser wrote: »

This trade deal was negotiated while the UK was still technically a member. Did the UK decide to have no say in the deal, was the UK not part of the process at all, could the UK have had a say but chose not to, or what?

Negotiations started in 2013 & finished in 2017, MEPs agreed it in 2018. We were going to be a full member of the EU for the first half of the negotiations and then we were still a member but it was unclear what the future status would be for the second half. I'm not entirely sure what our say would have been, but "have had a say" sounds like we should sit at the head of the table like Vito Corleone. "So we've decided this, UK is that good for you? Do you want us to change anything?"

Thrugelmir

phillw wrote: »

They would have to build factories in Turkey, build up a work force from scratch, get to know how to manage turkish people etc. It's probably not worth it for a few years.

Honda factory that is closing was opened in 1999.

Thrugelmir

SouthLondonUser wrote: »

This trade deal was negotiated while the UK was still technically a member. Did the UK decide to have no say in the deal, was the UK not part of the process at all, could the UK have had a say but chose not to, or what?

QMV.

Companies don't disclose their business plans until they have need to.

Kohoutek

Thrugelmir wrote: »

QMV.

Companies don't disclose their business plans until they have need to.

Nope. The EU-Japan deal needs to be ratified by all member states. It's entering into force prior to that as a provisional deal, subject to ratification.

phillw

Thrugelmir wrote: »

QMV.

Companies don't disclose their business plans until they have need to.

Or before they've made them. The possibility of moving car production from the UK to Japan will have been brought up in their discussions with the UK government, when they were given unspecified assurances. Which in hindsight seem to be worth about as much as a slogan on the side of a bus.

Thrugelmir wrote: »

Honda factory that is closing was opened in 1999.

1992 according to wikipedia, but they only make the civic saloon in turkey. https://en.wikipedia.org/wiki/List_of_Honda_assembly_plants

Swindon builds the other civic models and that is it, as they both share parts there is probably higher costs for turkey once swindon closes. Ramping up production in turkey would require investment & hiring. I can see why they decided to cut and run.

It's pretty clear the decision was influenced by the brexit negotiations, the timing itself is a clue to that.

The factory isn't closing until 2022, I wonder what required them to announce it now?

kabayiri

Thrugelmir wrote: »

By the sounds of it you've never bought a Honda either........;)
...

What do you think?

I meet many 'right on' liberals who bemoan the loss of British quality jobs, but never dream of spending 'how much!' money on quality goods made right here.

I've even seen on MSE statements like "we don't make anything any more, do we?".

It's pretty easy to blame politicians, but the attitude which demands the cheapest price is invariably going to see goods made in the cheapest location.

I don't feel guilt from the Honda situation. I've bought my Civic; my CRX and that ever so stupid 4 wheel steer Prelude !

movilogo

The most popular car in Germany is a German car.
The most popular car in France is a French car.
The most popular car in Sweden is a Swedish car.
The most popular car in Czech is a Czech car.

The most popular car in Japan is a Japanese car.
The most popular car in Korea is a Korean car.

The most popular car in Britain is a German car.*


* Usually Golf, Corsa or Fiesta - OK Ford is not German but you get the idea.


Then people moan when a foreign car maker leaves UK.

gfplux

phillw wrote: »

Or before they've made them. The possibility of moving car production from the UK to Japan will have been brought up in their discussions with the UK government, when they were given unspecified assurances. Which in hindsight seem to be worth about as much as a slogan on the side of a bus.



1992 according to wikipedia, but they only make the civic saloon in turkey. https://en.wikipedia.org/wiki/List_of_Honda_assembly_plants

Swindon builds the other civic models and that is it, as they both share parts there is probably higher costs for turkey once swindon closes. Ramping up production in turkey would require investment & hiring. I can see why they decided to cut and run.

It's pretty clear the decision was influenced by the brexit negotiations, the timing itself is a clue to that.

The factory isn't closing until 2022, I wonder what required them to announce it now?

If the withdrawal/transition/political declaration DEAL is passed by the British and EU Parliaments then the transition period would end on December 31st 2020.
So perhaps Honda are planning for the possibility of ceasing production of finished cars in December 2020 and finally close the site in January 2022.
That time frame allows them to continue production for a few months if there is an extension.

Arklight

Of all the British cars and brand that came and went the UK got lumbered with Rover. I'm not surprised people didn't buy them. Still doesn't mean Brexit is a good idea.