Brexit Consequences

[Lew Dolby]

That's Yorkshire folk for you - can't get through to 'em that if something ain't broke, it don't need fixing.

[bjn]

I heard on BBC news that Nissan now consider UK location competitive:

"It has created a competitive environment for Sunderland, not just inside the UK but outside as well.

"We've decided to localise the manufacture of the 62kWh battery in Sunderland so that all our products qualify [for tariff-free export to the EU]. We are committed to Sunderland for the long term under the business conditions that have been agreed."

Sounds rather better than what had been feared?

They are saying "Brexit allows us to make batteries in the UK and ship them to the EU!", how is this different to what they could do while in the EU?

I think they are just fellating the government to make them happy to hand over more grant money.

[veravista]

Will probably go some way to keeping the factory busy as they're having real problems getting stock from the EU and production has virtually halted.

[Martin Y]

I'm torn between relief that the factory isn't shutting down and resentment that it's more than they deserve after voting for the face-eating leopards.

It certainly looked like all the Japanese manufacturers were ready to up sticks and take manufacturing home but of course that makes delivery times to Europe weeks longer so they would be happy to stay if there isn't a serious cost penalty. It appears Nissan have done the sums and decided the deal makes it cost-effective to continue in Sunderland rather than set up inside the EU or build in Japan for the European market.

The comments below the BBC article are of course exactly as you imagine: wall-to-wall gloating by Brexiteers imagining the tears of Remoaners now this piece of the the sky has not fallen.

[bjn]

I'm torn between relief that the factory isn't shutting down and resentment that it's more than they deserve after voting for the face-eating leopards.

It certainly looked like all the Japanese manufacturers were ready to up sticks and take manufacturing home but of course that makes delivery times to Europe weeks longer so they would be happy to stay if there isn't a serious cost penalty. It appears Nissan have done the sums and decided the deal makes it cost-effective to continue in Sunderland rather than set up inside the EU or build in Japan for the European market.

The comments below the BBC article are of course exactly as you imagine: wall-to-wall gloating by Brexiteers imagining the tears of Remoaners now this piece of the the sky has not fallen.

However you might not get new factories set up in the U.K., Tesla was seriously considering it, but settled on putting their European plant in the Germany, directly attributing it to Brexit.

[Woodchopper]

I'm torn between relief that the factory isn't shutting down and resentment that it's more than they deserve after voting for the face-eating leopards.

It certainly looked like all the Japanese manufacturers were ready to up sticks and take manufacturing home but of course that makes delivery times to Europe weeks longer so they would be happy to stay if there isn't a serious cost penalty. It appears Nissan have done the sums and decided the deal makes it cost-effective to continue in Sunderland rather than set up inside the EU or build in Japan for the European market.

The comments below the BBC article are of course exactly as you imagine: wall-to-wall gloating by Brexiteers imagining the tears of Remoaners now this piece of the the sky has not fallen.

However you might not get new factories set up in the U.K., Tesla was seriously considering it, but settled on putting their European plant in the Germany, directly attributing it to Brexit.

Yes. Trading with the EU on WTO terms would have been a disaster. The FTA means that the factories won’t get closed down in 2021. But long term investment might not favour the UK.

[Little waster]

I'm torn between relief that the factory isn't shutting down and resentment that it's more than they deserve after voting for the face-eating leopards.

It certainly looked like all the Japanese manufacturers were ready to up sticks and take manufacturing home but of course that makes delivery times to Europe weeks longer so they would be happy to stay if there isn't a serious cost penalty. It appears Nissan have done the sums and decided the deal makes it cost-effective to continue in Sunderland rather than set up inside the EU or build in Japan for the European market.

The comments below the BBC article are of course exactly as you imagine: wall-to-wall gloating by Brexiteers imagining the tears of Remoaners now this piece of the the sky has not fallen.

However you might not get new factories set up in the U.K., Tesla was seriously considering it, but settled on putting their European plant in the Germany, directly attributing it to Brexit.

Yes. Trading with the EU on WTO terms would have been a disaster. The FTA means that the factories won’t get closed down in 2021. But long term investment might not favour the UK.

The FTA half of the Brexiteers were adamantly opposed to and denied was even necessary.

[veravista]

This has got to be a joke, surely?

https://www.theguardian.com/politics/20 ... shop-in-eu

[plodder]

This has got to be a joke, surely?

https://www.theguardian.com/politics/20 ... shop-in-eu

My reading is they’re recommending setting up a holding company in the EU. Sounds a bit fiddly from a tax perspective...

[sTeamTraen]

This has got to be a joke, surely?

https://www.theguardian.com/politics/20 ... shop-in-eu

I doubt if it's government policy yet. The headline comes down to "Two firms have told us that they were told, in conversations with civil servants, that setting up an EU office might be the least worst solution", which is true. You could spin it as "UK's world-beating civil servants give optimum advice over Brexit", and doubtless the Daily Express will.

[Millennie Al]

I heard on BBC news that Nissan now consider UK location competitive:

"It has created a competitive environment for Sunderland, not just inside the UK but outside as well.

"We've decided to localise the manufacture of the 62kWh battery in Sunderland so that all our products qualify [for tariff-free export to the EU]. We are committed to Sunderland for the long term under the business conditions that have been agreed."

Sounds rather better than what had been feared?

This is the battery factory at the Nissan Sunderland factory that was sold off in 2019. The agreement between the UK and the EU means that the trade barrier between the two varies depending on the extent to which a product is made in the UK rather than assembled there. The alternative to making the batteries in the UK is importing them from places like Japan. I don't know if this leaves EU factories at an advantage or not (i.e. whether they are free to import the batteries while we are not).

But this follows a lot of warnings from Nissan saying that a trade barrier between their UK factory and the EU would endanger the viability of the UK factory, so it's more maintenance of the status quo rather than the creation of an advantage.

[veravista]

This has got to be a joke, surely?

https://www.theguardian.com/politics/20 ... shop-in-eu

My reading is they’re recommending setting up a holding company in the EU. Sounds a bit fiddly from a tax perspective...

It's not setting up a holding company, it's setting up a wholly owned subsidiary with EU staff, articles and tax liabilities including staff, rent and rates all paid for in the UK. It would allow transfer of products between the UK and EU in bulk with little cost (value over £136), but VAT will still be paid but in the host country and without the 'creative' costs of direct delivery from the UK.

[bjn]

This has got to be a joke, surely?

https://www.theguardian.com/politics/20 ... shop-in-eu

My reading is they’re recommending setting up a holding company in the EU. Sounds a bit fiddly from a tax perspective...

It's not setting up a holding company, it's setting up a wholly owned subsidiary with EU staff, articles and tax liabilities including staff, rent and rates all paid for in the UK. It would allow transfer of products between the UK and EU in bulk with little cost (value over £136), but VAT will still be paid but in the host country and without the 'creative' costs of direct delivery from the UK.

If this keeps up, I can see a company stepping in to do that as a service for a range of small companies. EU-Warehousing-And-Distribution-R-US.

Still a stupid added cost and complexity to whole business that puts any trade from the mainland UK at a competitive disadvantage. Exporters in the EU suffer it going the other way, but because market sizes are so out of whack, it will disproportionately affect UK businesses.

[shpalman]

If this keeps up, I can see a company stepping in to do that as a service for a range of small companies. EU-Warehousing-And-Distribution-R-US.

That would be EU-Warehousing-And-Distribution-R-US buying stock in bulk from lots of small UK companies and then selling it on in the EU?

Well I suppose each UK company would have to just do one lot paperwork at once instead of each time for each small personal order. And the EU company would become specialized in helping the UK companies with that.

It would certainly make it easier for personal buyers in the EU.

Of course the costs all increase because of the extra middlemen.

[bjn]

The problem seems to be that their is a minimum cost for the paperwork independent of the cost of the order. So bulk sale and shipping would lower the unit cost.

EU-Warehousing-And-Distribution-R-US would have to buy the goods and ship them on, probably with rebranding to make it look like the originating company did the whole thing if you don’t look at the small print. Off the top of my head, some sort of clever invoicing by the UK company having a wholly owned shell company in the EU would deal with cash flow issues for R-US. The shell being owned by the UK company. It does mean avoiding the cost of actually operating your own warehouse and distribution system. R-US could even do a chunk of the shell company work to keep it simpler for small businesses. Though you are big enough, you’d do it yourself.

But extra cost and complexity which an EU company doesn’t have to do.

[veravista]

But each UK company would need to do all the paperwork for the UK holding warehouse, which in turn would need to be done to allow it to be shipped to the EU. Unless their is someway you could split orders into luxury goods, non-animal origin, items requiring SPS certs the paperwork will still need to be on each and every shipment - unless the holding company bears the cost.

Sure there is a way round but a I bet as soon as it's set up it'll get shut down if it's not 100% legit. Then of course unless they are classed as 100% EU the goods may still be subject to each member states individual rules

[bjn]

But each UK company would need to do all the paperwork for the UK holding warehouse, which in turn would need to be done to allow it to be shipped to the EU. Unless their is someway you could split orders into luxury goods, non-animal origin, items requiring SPS certs the paperwork will still need to be on each and every shipment - unless the holding company bears the cost.

Sure there is a way round but a I bet as soon as it's set up it'll get shut down if it's not 100% legit. Then of course unless they are classed as 100% EU the goods may still be subject to each member states individual rules

As I said, off the top of my head. What seems to be needed is an EU based entity to place bulk orders to UK companies and then handle shipping and distribution to individual customers. The UK government suggests that both of those be the same thing as an EU subsid of the UK company. I’m saying you could separate the two. Setting up an EU company should be fairly easy (it’s what Ireland specialises in), but setting up the warehousing and shipping requires people and facilities and all the pain that requires. So set up a shell company that places bulk orders from the UK parent, but outsources the warehousing and distribution to the R-US company. Nothing dodgy and all quite straightforward, but still an extra pain on what we have already.

Amazon could easily do it.

[sTeamTraen]

As I said, off the top of my head. What seems to be needed is an EU based entity to place bulk orders to UK companies and then handle shipping and distribution to individual customers. The UK government suggests that both of those be the same thing as an EU subsid of the UK company. I’m saying you could separate the two. Setting up an EU company should be fairly easy (it’s what Ireland specialises in), but setting up the warehousing and shipping requires people and facilities and all the pain that requires. So set up a shell company that places bulk orders from the UK parent, but outsources the warehousing and distribution to the R-US company. Nothing dodgy and all quite straightforward, but still an extra pain on what we have already.

Amazon could easily do it. [Emphasis added]

ISTM that it's simpler than that. Your first sentence here basically describes what an Amazon national operation in the EU already does.

[bjn]

Except i want to have my own web store and to be in charge of the customer relationship. Sending a potential customer who is ready to buy from my website to Amazon to actually buy my stuff is not a smart move. Amazon doesn’t provide a simple distribution and warehousing service, they are in charge of the whole stack. They could, but probably wouldn’t want to.

[jdc]

This has got to be a joke, surely?

https://www.theguardian.com/politics/20 ... shop-in-eu

Andrew Moss one of the business owners setting up in the EU also mentioned here: https://www.theguardian.com/politics/20 ... king-point

The last three weeks, he says, have been a living nightmare. “Soft Brexit – there is no such thing. This is horrific,” he says. “We celebrated the Brexit deal with champagne over Christmas but when we woke up and realised that this car crash was happening, we thought, oh my God!”

Previously, when the UK was in the EU and during the transition period, Moss and other small businesses did not charge VAT on customers in other EU countries. But EU rules on third countries dictate that VAT must now be paid before goods are received from the UK.

Moss could not believe what was happening.

Andrew Moss is a dickhead.

[PeteB]

https://www.turbulenttimes.co.uk/news/b ... y-triumph/

[TimW]

It's official. I heard the slogan on the radio.

Brexit:
new rules are here

New rules apply to things like travel and doing business with Europe. Use the Brexit checker to get a personalised list of actions for you, your business and your family.

- Check - Change - Go

[FlammableFlower]

John Redwood, you are a complete and utter... blank...

He is definitely of the "everything would be perfect if people just wanted it hard enough" school of Brexit.

James Wong
@Botanygeek
‘Not much choice of U.K. fruit and veg in some shops’.

I often think we need to have better education on farming and food production in the U.K.

For some, that may need to start with explaining the concept of winter.

Quote Tweet
John Redwood
@johnredwood
· Jan 24
There is plenty of support for growing more of our own food. Tell your local supermarket we want more U.K. produce. I am pressing the government to get behind our farmers and fishing industry. Not much choice of U.K. cheeses, fruit and veg in some shops.

[tenchboy]

John Redwood, you are a complete and utter... blank...

He is definitely of the "everything would be perfect if people just wanted it hard enough" school of Brexit.

James Wong
@Botanygeek
‘Not much choice of U.K. fruit and veg in some shops’.

I often think we need to have better education on farming and food production in the U.K.

For some, that may need to start with explaining the concept of winter.

Quote Tweet
John Redwood
@johnredwood
· Jan 24
There is plenty of support for growing more of our own food. Tell your local supermarket we want more U.K. produce. I am pressing the government to get behind our farmers and fishing industry. Not much choice of U.K. cheeses, fruit and veg in some shops.

I thought that sounded familiar; did no one tell him last month?

[shpalman]

It's minus five out there just now John. What the jeebus do you think I should plant? A field of Cornetto's?