Brexit threatens Jaguar Land Rover's tie to Birmingham, MP warns
Jaguar Land Rover’s historic ties with the West Midlands would be threatened by a Brexit, according to a senior MP.
Former Home Secretary Alan Johnson said the car giant might face a 14 per cent tariff to export to the European Union within a matter of two years if the UK was to leave.
Speaking to the Birmingham Mail on a visit to the city, Mr Johnson, chair of the Labour In for Britain group, said JLR would be unlikely to supply cars to mainland Europe from this region were tariffs brought in, which would threaten jobs.
Meanwhile, Mr Johnson defended Jeremy Corbyn’s leadership of the Labour party which has come in for criticism over anti-Semitism claims and a public falling out between two senior politicians.
He said: “If there were suddenly new tariffs on cars, it would have a major impact on the West Midlands.
Bob Roberts Daily Mirror interview with new Shadow Chancellor Alan Johnson at BBC Television Centre in London. 17.10.10 Tim Anderson picture.
“If every car that is made at Jaguar Land Rover and was being exported to the EU was subject to a 14 per cent tariff, and they had to absorb this tariff when they wouldn’t in France, the UK or Slovakia, it wouldn’t take too long before they started asking why they would make cars for the EU here.
“That is why Jaguar Land Rover are worried about this.”
He added: “We would have two years to get back to where we are.
“Before we negotiated an agreement, 53 countries would have to say yes.
“If that failed, the World Trade Organisation rules would kick in and we’d have to start paying tariffs again.”
More than three-quarters of cars made in the UK were exported in 2015, making the sector the country’s largest goods exporter – and JLR the largest.
In total, 1.23 million cars went overseas, up from 1.19 million a year earlier, according to industry body the Society of Motor Manufacturers and Traders.
Tariffs have become a central issue in campaigning ahead of the EU referendum on June 23.
Those backing a Brexit claim, while countries like Norway face huge tariffs to trade with the EU, the strength of Britain’s economy would strengthen its arm in negotiations.
City MP Gisela Stuart said the region’s eminence in research and development was a draw to companies like JLR.
Ms Stuart (Lab Edgbaston), who chairs Vote Leave, added: “Why do countries trade? Why do people buy from us? It is because we have got something to sell them which they want.
“People seem to think this is an automatic thing.
“Every year, with the exception of about three countries, we are net importers – we buy more than they sell us.
Birmingham MP Gisela Stuart is campaigning for the UK to leave the EU in the referendum on June 23
“There is nothing more cut-throat than trade negotiations, and if you are the bigger customer than you are in a strong position to arrive at a deal.”
Elsewhere, Mr Johnson said while the West Midlands was a net contributor to the EU, the region was still stronger as part of it.
He added: “Britain is a richer country so we make a net contribution to the European Union. Some regions – Yorkshire and Humber, the South West and Wales – are beneficiaries, but overall we make a contribution.
“But it is not made on the basis that we will get more money back than we put in – it is also about getting access to the biggest commercial market in the world – bigger than China, the US, anywhere – and a market Britain had a big hand in creating.
“Companies that export no longer have to worry about tariffs, like on cars and ceramics, which would have a major impact in the West Midlands.”
Ken Livingstone has come under pressure
Meanwhile, the Labour party has come in for criticism after controversial comments by MP Naz Shah and former Mayor of London Ken Livingstone.
That followed a public dressing down of Mr Livingstone by MP, and fellow Labour member, John Mann, condemning him for a “grotesque attempt at rewriting history by claiming Hitler supported Zionism”.
Mr Johnson denied that it highlighted disciplinary issues under Jeremy Corbyn’s leadership – and argued that falling out could have happened under any Labour leader.
He said: “People have rows with one another all the time – but generally it doesn’t happen in full view of cameras.
“You should never have arguments in public – whether you are working for the Birmingham Mail, the Labour party or the BBC.
“But it could have happened under Tony Blair, Gordon Brown or anyone else.”