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Ford, BMW, Join Britain’s Brexit Argument, But Miss The Point

Ford, BMW, Join Britain’s Brexit Argument, But Miss The Point

“It’s like Americans waking up one day to find Congress has been taken over by NAFTA”

It’s Not The Economy, Stupid.

    Car manufacturers have jumped into Britain’s European Union (E.U.) referendum debate and are in danger of antagonising their customers because they, along with President Barack Obama, misunderstand what the argument is all about.

    The manufacturers, led by Ford and BMW, are busily pointing out how their businesses will be harmed if Britain withdraws from the E.U. The fact that this is contentious is bad enough; many experts believe Britain can survive and thrive outside the E.U. But the underlying referendum argument, now known by the shorthand “Brexit”, is about freedom and liberty and who governs Britain, at least for the “Leave” supporters. It is not for them about whether people will be a bit better or worse off.

    Britain votes on June 23 and the choices on the ballot paper are “Leave” or “Remain”. Britain joined the European Union in 1972 and three years later approved membership in a referendum. Then, supporters of E.U. membership said this simply meant membership of a free trade zone. There was no possibility of conceding any political power to Europe. Since then the E.U. has gradually grabbed power to the extent that now more than half of Britain’s laws are passed there. The famous old Parliament building in Westminster has been largely bypassed. MPs still debate issues there, but power has moved to Brussels, without the consent of the British people.

    U.S. Controlled by NAFTA
    It’s like Americans waking up one day to find Congress has been taken over by NAFTA.

     Those supporting “Leave”, want to break free of what they consider to be the E.U.’s unaccountable, bureaucratic and opaque political structure. That’s why U.S. President Barack Obama’s remarks, on a recent visit here, that Britain should stay in, was greeted with such hostility. Americans, they said, would never submit to such an undemocratic regime, so why should their president expect Britons to?

    Britain’s media and air waves are currently reverberating to an increasingly vicious campaign, but the car manufacturers are displaying a tin ear to the political implications.     

    Winning the prize for missing the point, Germany’s BMW said it doesn’t think the issue is political. And Ford Motor Co’s European subsidiary, warning again of possible dire risks if the “Leave” campaign wins, also said this is strictly economic and not political.

    Most car manufacturers kept silent in the build up to the campaign last year, preferring to say things like “Let the voters decide. We’ll live with whatever they want,” with the exception of BMW and Ford Europe.

    Both these companies decided to jump in early with their views that Britain should stay, led by BMW and its British board member for sales Ian Robertson. Some say this broke an unwritten rule about companies taking sides in elections.

    Neutrality gone
    As the date for the vote drew closer, more manufacturers threw aside any pretence of neutrality and joined in, including Japan’s Toyota, General Motors Europe and Nissan of Japan. GM operates the Opel brand in mainland Europe, and sells the same vehicles as Vauxhalls in Britain. Their position of letting the voters decide became one of “let them decide, but if they vote “Leave”, things could get nasty”. Volkswagen has kept out of the debate so far.

    It could be that these manufacturers are genuinely missing the political point. The manufacturers expressing an opinion all agree that there is a big risk to British business and foreign trade if the country left the E.U. The “Leave” campaign contends leaving will have minimal impact on trade and might even improve it, but it doesn’t matter if the economy is a little bit better or worse, because freedom and liberty are at stake. The car companies are in danger of being seen to be associated with those against freedom and liberty. They are playing a dangerous game and risk alienating potential customers.

    BMW’s Robertson, on the sidelines of Automotive News Europe’s annual congress last week in Munich, was asked, given the company’s intervention, would it now make its views known at a future general election if a party offered policies harmful to its interests.

    “No. That’s politics,” Robertson said, appearing shocked, and adding Brexit was about free trade and economics, not politics.

    Minis say “Stronger In”
    BMW owns the Mini brand, which produces most of its vehicles in Britain, and super-luxury Rolls-Royce. It employs close to 8,000. It recently staged a political event with Prime Minister David Cameron who posed in front of Minis with “Stronger In” on their number plates.

    “I’m passionate about Britain’s economy and its island trading traditions of doing business freely with the world,” Robertson said.

   Robertson said Britain’s prosperous economy would be hampered by Brexit and without the free flow of workers from the E.U.

    Another issue in the campaign is immigration. While Britain is in, all E.U. citizens have the right to work there. “Leave” campaigners want to restrict this and make sure only qualified people are allowed in.

    Ford of Europe returned to the argument this week, with CEO Jim Farley saying potential future investment in the U.K. could be at risk if leaving the E.U. led to a serious deterioration of the economy.

    “If the U.K left the E.U., it could create economic instability and uncertainty, the full consequences of which are unknown generally and, specifically, to our business,” Farley said in an interview with Automotive News Europe.

    Ford makes no vehicles in Britain now but has three plants making engines and transmissions, a technical research center and its banking arm. It recently shut its van making factory here, and moved production to Turkey, to serve E.U. markets. Turkey is outside the E.U.

    No precedent
    Asked if Ford’s referendum position might be a precedent for future political intervention, a spokesman for Ford U.K. said this wasn’t the case.

    “Ford’s concerns are all economic.  We have carried out a number of detailed business investigations with our own and external strategists and our considered view is that the Ford of Europe business is best served with the U.K. as a member of the E.U.,” said Tim Holmes, Ford U.K. Communications and Public Affairs director.

   “We have advised our employees of Ford’s position. However we have also stated that it is up to the British people to decide. We do not believe that having a business view of Brexit is the same as ‘full-blown political intervention’ as you put it – and this does not signal a change in our policy to avoid active political engagement,” Holmes said.

      That would explain why many auto manufacturers had jumped into the referendum argument, having convinced themselves it was purely about economics and trade. But after the vote on June 23, political experts expect Prime Minister David Cameron to be forced to resign if the vote is won by “Leave”. His position may even be in jeopardy if “Remain” wins but the vote is close. And Britain’s political direction for the next 50 years is about to be decided.

    If that’s not political, what is?    

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One Response to Ford, BMW, Join Britain’s Brexit Argument, But Miss The Point

  1. Phodus June 25, 2016 at 7:08 am #

    Even if the base reason is political, 4% tax on parts impotriva and 10% on exporting finished cars WILL hurt the economy (not the minimal impacat you talk about). Freedom and liberty are all very nice, but a job is nicer, and factories can be relocated.

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