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Old 22nd June 2016, 18:38   #1
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Default Britain exiting the European Union

What would happen to our car scene if Britain exits EU?

Tata owned Jaguar Land Rover, estimates its annual profit could be cut by 1bn by the end of the decade if Britain leaves the European Union.

What will be other effects if this happens?
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Old 22nd June 2016, 19:34   #2
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Default re: Britain exiting the European Union

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Originally Posted by shreyaskr View Post
What would happen to our car scene if Britain exits EU?

Tata owned Jaguar Land Rover, estimates its annual profit could be cut by 1bn by the end of the decade if Britain leaves the European Union.

What will be other effects if this happens?
As far as I can understand, Brexit will have no impact on Indian Car scene.

Why exactly do you feel there would be an impact on Indian Car market?
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Old 22nd June 2016, 19:37   #3
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Default re: Britain exiting the European Union



Yesterday in BRexit debate on BBC (which aired at 0030 hours, Boris said that UK buys 80% of total cars produced by Germany. Seriously, that many?


Returning to topic
India has a trade agreement with UK. India has a trade agreement with EU. India continues to trade with both. Impact? A big fat ZERO
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Old 22nd June 2016, 21:24   #4
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Default re: Britain exiting the European Union

@E63; A lot of the Fords sold in the UK are made in Germany, multiply to others, and the 80% figure does not look that preposterous. I remember our Chief Technician bought a Ford Escort Ghia, to support British Industry, and found that it was made in Germany.

Who owns RR & Bentley. One of them is BMW owned!

In any case the referendum is tomorrow.
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Old 22nd June 2016, 21:30   #5
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Default re: Britain exiting the European Union

I think this will come down to nullified trade agreements between UK and EU. There would be some sabre-rattling as always. But UK stands to lose. They neither have the space nor the capability for large scale manufacturing and they would spend a lot more money getting things including cars imported. Their current free-trade model would be reviewed by the EU countries as well.

From an Indian market perspective, I don't see any change other than if a EU or UK manufacturer uses components from the other.
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Old 22nd June 2016, 21:55   #6
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Default re: Britain exiting the European Union

If there is a Brexit - the EU will wreak revenge

Tata's will get affected due to tariffs applied on cars sold on EU
Nissan and Toyota cars become uncompetitive - they might shift to Poland. Slovenia etc.
UK car components get more expensive
UK as a traditional hub for Indian investment into Europe will be questioned

Of course - the UK is like Kerala where the locals will not do the menial task. These are done by eastern europeans, if they go, it will be interesting!

I am hoping common sense prevails and have spread my bets accordingly

Last edited by ajmat : 27th June 2016 at 13:51.
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Old 22nd June 2016, 22:54   #7
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Default re: Britain exiting the European Union

I'll be watching the currency implications. If Britain opts to log out, Pound Sterling may plunge. Trades will suffer as Britain will have to renegotiate the terms with all partners which was previously done under the EU umbrella. Obviously, this will be a short term impact but this period may push up the dollar and English currency may suffer.

As another impact of an expensive dollar, for us, fuel bills may go higher and companies importing stuff may see higher outflow. This can include car makers who import raw materials and parts and pay in dollars. This may have an impact on the Indian car scene; the answer that this thread seeks.
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Old 22nd June 2016, 23:47   #8
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Default re: Britain exiting the European Union

In fact, all investments by Indians in the U.K. will be affected, as the company balance sheets will show the exit aftereffects.The effects will be mainly due to levies on British goods in the entire European Union.

The effects can be gauged as the news pours in every moment .

Last edited by anjan_c2007 : 22nd June 2016 at 23:48.
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Old 23rd June 2016, 00:34   #9
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Default re: Britain exiting the European Union

As someone who currently lives in London and have followed the Brexit saga closely, I can tell you one thing - there is too much information out there which is simply incorrect.

For starters, this referendum is like an opinion poll and as such does not bind the govt to exit the EU. David Cameron has said that he'll honour the verdict and start taking steps to exit, but this is easier said than done. In the UK alone, they need to pass multiple laws to exit the EU and some of these require 2/3d majority. In a parliament where a major portion of MPs are opposed to Brexit, this will be easier said than done. Remember - UKIP for all the noise they make has 1 seat in the UK parliament. So in the event of a marginal victory (say 51/49) for Leave, the govt can as well make the case that just over 25% of the population actually want to exit (typical voting percentage is in the 50% range) and use that argument to not take a decision. Even if everything falls in place, it is expected to take over 2 years just to get all laws passed to exit.

Long and short of it - there will be some near term impact in terms of sentiment and the sterling will drop against the $/Euro, but expect it to recover at least in the medium term and no real change for the next 1-2 years.

Having said all of this, I agree with Ajmat - the UK locals don't want to do any menial jobs - all of these are done by the eastern europeans. The immigration debate is actually a bit of a red herring IMHO..

I hope sense prevails and we don't end up leaving!
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Old 23rd June 2016, 09:27   #10
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Default re: Britain exiting the European Union

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Originally Posted by prashanthyr View Post
As someone who currently lives in London and have followed the Brexit saga closely, I can tell you one thing - there is too much information out there which is simply incorrect.

For starters, this referendum is like an opinion poll and as such does not bind the govt to exit the EU. David Cameron has said that he'll honour the verdict and start taking steps to exit, but this is easier said than done.
Having lived for five years in the UK I have both connections and interest in the country. I think if the vote is OUT then Cameron will honour it, and probably quit as well. As for the loonies the UK specializes in them, but here quite a few Tories (and some Labour) are also with the UKIP. They still dream/talk of the old Empire, even though that is deep history. I guess what may sway the brits is the prospect of house prices slumping.

It is too close to call, so let us watch and wait.
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Old 23rd June 2016, 10:31   #11
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Default re: Britain exiting the European Union

These days, global financial media seems to hype country specific events and even use catchy Tabloid-like names (Grexit, Brexit, Rexit etc).

The net effect of all these binary events is usually zero.
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Old 23rd June 2016, 14:32   #12
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Default re: Britain exiting the European Union

Think of Europe Union and the erstwhile European common market as SWADESHI movement.
If these incentives to be swadeshi are taken away (incentives = agreements on mutual trades and lowered taxes, subsidies etc), then you only make the market more open.

Which means perhaps Brits can get cheaper stuff of better quality products and services from abroad, rather than relying on their swadeshi counterparts (say France or Germany). What does it means for India? Quite a lot.

Car scene? I don't have much idea about Indian manufactured car exports, but surely they will stand a better pricing compared to European manufactured ones after the country decides to leave the Swadeshi clan.

###

Essentially, European Govts and public are able to live their lavish lethargic socialist lifestyles mainly because of the presence of common European market concept.

The whole "European swadeshi" movement came about after WW2 when European countries woke up to dominance of US and its superior economy as well as the Eastern Bloc of Communist nations.
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Old 23rd June 2016, 15:27   #13
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Default re: Britain exiting the European Union

Coin has two sides, Most pro Brit-exit folks in London are pretty confident the exit will help the UK do much better than it is now,

One strong reason to vouch that fact are examples to the likes of Swiss, Norway, Iceland who are independent and are doing quiet well.
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Old 23rd June 2016, 15:34   #14
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Default re: Britain exiting the European Union

UK to withdraw from EU? Amul's take on it


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Old 23rd June 2016, 15:41   #15
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Default re: Britain exiting the European Union

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Originally Posted by sriramr9 View Post
Coin has two sides, Most pro Brit-exit folks in London are pretty confident the exit will help the UK do much better than it is now,

One strong reason to vouch that fact are examples to the likes of Swiss, Norway, Iceland who are independent and are doing quiet well.
Norway, swiss were different; its not like they were in there and then came out. Exiting EU is different. To keep themselves up and running Britain would have to agree to EU trade norms without having a voice in it.
Plus switzerland is a one off case, the only one possible in the world. Norway and Iceland both have a good supply of natural resources. Britain is a small country with less manufacturing heritage and resources.

Last edited by ashokrajagopal : 23rd June 2016 at 15:44.
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