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Airbus CEO says UK government has ‘no clue’ how to handle Brexit

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Airbus CEO says UK government has ‘no clue’ how to handle Brexit

Airbus CEO says UK government has ‘no clue’ how to handle Brexit
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The head of Airbus has warned the British government that in a worst-case scenario Brexit could result in production at its factories stopping and aircraft being grounded.

Airbus Chief Executive Tom Enders said on Friday, "The certification for thousands of parts that are today part of the supply chain, part of our aircraft, would fall apart, and that could be a very troubling situation for us and could eventually lead to a standstill of production,"

Enders did not seem hopeful that the British government will make progress, saying earlier that it has "no clue or at least (no) consensus on how to execute Brexit without severe harm".

He defended Airbus' decision to issue the warnings. "We will, of course, speak up. We do this because this is what we owe our shareholders," German-born Enders claimed.

For Airbus, which makes the wings for all of its passenger jets in Britain, that worst-case scenario would occur if Britain is no longer part of the EU aviation safety certification agency, EASA, which gives planes and parts approval so they can fly.

Guillaume Faury, the boss of Airbus' plane-making unit, said jets could also be grounded.

"In case there is no agreement, we will not be allowed to install parts and make them fly on airplanes so there will be aircraft grounded," he said at Airbus's annual media briefing in London.

Asked to provide examples of the steps being taken to soften the impact of Brexit, Faury said the company was looking at installing a three-month buffer of parts in some factories.

However, in order to reach this level in the nine months remaining before Britain leaves the European Union, suppliers would have to abruptly raise production by one third — whereas most suppliers were already at full capacity, he said.

Airbus is building warehouses to store the extra parts, an industry source added.

FRACTIOUS CABINET

May hopes to settle differences in her fractious cabinet about Brexit at a meeting in her country residence Chequers, enabling her to unblock stalled talks with the European Union.

Those talks follow a step-up in warnings from various companies in recent weeks.

Airbus last month issued its strongest warning yet over Brexit, saying that withdrawal without a deal would force it to reconsider its long-term position and put thousands of British jobs at risk.

Companies have become increasingly vocal about the risks of Brexit, hoping to have an impact on the outcome of crunch talks between British Prime Minister Theresa May and her senior ministers on Friday.

For companies, the biggest worry is that Britain leaves the bloc without a deal, a so-called "hard" Brexit.

Britain's biggest carmaker Jaguar Land Rover joined in on Wednesday, saying a chaotic Brexit would cost it €1.35 billion a year, curtailing operations in the United Kingdom. The retail industry said a "no deal" might see "food rotting at ports".