Why Airbus' UK Brexit Bail Could Be Bad News For The Economy

Sara C Nelson

The aerospace firm Airbus has issued a strong warning over the impact of Britain’s departure from the EU, saying a withdrawal without a Brexit deal would put thousands of Airbus jobs in the UK at risk.

“Put simply, a no-deal scenario directly threatens Airbus’ future in the UK,” said Tom Williams, chief operating officer of Airbus Commercial Aircraft, on Thursday.

But why is this a big deal? Here’s what you need to know:

Why might Airbus pull out?

Airbus is a major player in the aerospace and defence industry, operating commercial aircraft, helicopters and defence and space branches of its company. 

For its operations in the UK, it relies on “frictionless trade”, which, under customs union and single market rules, means it can easily shift parts and materials between EU countries without fees or regulations. 

But it says that any change in these procedures would have a major industrial cost and impact. 

Publishing a Brexit “risk assessment” on its website, the firm called on the Government to extend the planned transition period from EU membership, due to run until December 2020 if a deal is agreed, saying it was too short for the business to reorganise its supply chain.

The firm stressed a sudden end to free movement rules would directly threaten its future in the UK.

It said that employees need to be able to move across borders at short notice to fix production line issues, and new visa requirements would make them “more complicated to deal with”, affecting “the long-term competitiveness of UK sites”.

How many staff does Airbus employ in the UK?

The firm directly employs 14,000 people at 25 sites in Britain and supports more than 100,000 jobs in the wider supply chain.

Around 6,000 people are employed at the firm’s wing manufacturing plant in Broughton, North Wales. The second largest site in Filton, near Bristol employs approximately 4,000 people.

How Are People Reacting To The News?

The news was greeted by anger from Labour MPs. Darren Jones, whose Bristol North West constituency contains Airbus’s Filton wing plant, attacked the Government for only listening to “hardline pro-Brexit MPs and not to the businesses that employ thousands of British workers, including Airbus”.

Jones said that “thousands of skilled, well-paid jobs are now on the line because of the shambolic mess the Government have created over the Brexit negotiations.”

Shadow Brexit Secretary Sir Keir Starmer hit out on Twitter, saying: “If proof was needed that the PM’s Brexit red lines need to be abandoned (and fast), this is it.”

And the former shadow chancellor Chris Leslie wrote: “And we’re all supposed to go along with this Government’s disastrous #Brexit strategy?! Constituents in manufacturing & service sectors who jobs are at risk will be unforgiving of any more MP fence-sitting ‘constructive ambiguity’.”

Prime Minister Theresa May’s spokesman responded to the news on Friday by stating: “We are confident that we are going to get a good deal, one that ensures that trade is as free and frictionless as possible, including for the aerospace sector.”