Jaguar Land Rover could suffer £1bn loss if Britain exits EU
Jaguar Land Rover’s profits could be affected to the tune of £1bn ($1.47 billion or INR 9,923 crore) by 2020, if Britain decides to leave European Union.
The British automaker produces 500,000 vehicles per annum, nearly a third of UK’s annual output of cars. The Tata Motors owned brand will be the most affected of all British automakers. This will be due to with higher trade tariffs where imports and exports are concerned if UK opts out of the European Union.
Brexit will result in a 10% hike in taxes with vehicles being exported to Europe while 4% levy will have to be incurred by the company where import of components is concerned. This will come into effect as free trade agreement, currently applicable, will be stalled while standard World Trade Organization regulations will come into effect.
Jaguar Land Rover, headquartered in Coventry, Central England traces its history to 1922. JLR, owned by Tata Group is undergoing rapid expansion even as demand for its premium cars have increased considerably.
Besides its UK manufacturing plants in Castle Bromwich, Solihull and Halewood, the company also has liaisons with Chery Automobiles in China and recently opened a new plant in Brazil.
JLR is aware of the difficulties it will face if Britain’s exit from EU comes into effect and is currently weighing possibilities of opening an office in Europe. JLR has also stalled work on a plant in Slovakia while talks to secure property at Silverstone Race Track are also being deferred till such decisions are clear.