Brexit worry “overrated” says Brompton Bicycles CEO

Posted on 15 Mar 2017 by Jonny Williamson

Founder and CEO of Brompton Bicycles, Will Butler-Adams OBE, has criticised the country’s pervasive pessimism towards Brexit, describing concerns as being “overrated”.

Butler-Adams made the comment during the All-Party Parliamentary Manufacturing Group’s Exporting after Brexit debate in the House of Commons last Thursday (9 March).

The lively debate saw members of the British and European Parliaments come together with an audience of 120 British manufacturers and international trade experts to discuss the future of the UK’s trading relationship with Europe and the rest of the world.

Opening the debate, chair of the All-Party Parliamentary Manufacturing Group and member of the BEIS select committee, Chris White MP noted: “Brexit is of course of incredible interest to British manufacturers.

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“We have already seen the impact of Brexit on manufacturers in terms of raw materials costs and exchange rate fluctuations. We need to have a vigorous debate to ensure that manufacturers get a say in future trade policy.”

To which Brompton Bicycles’ Will Butler-Adams OBE countered: “Brexit is overrated. All this worrying is causing everyone to stagnate. I am an SME business; what matters to my business is launching new products.

“We’ve just seen an FX [foreign exchange] drop against the Japanese Yen by 25%, so who cares about a bit of import duty. For small businesses, these things come and go – it’s our job to deal with it.”

In debate, and in conversation with the audience, the panel touched on many of the significant issues facing manufacturers post-Brexit. Topics included: what the future holds for EU trade if the UK fails to secure a deal with the EU and returns to World Trade Organisation (WTO) tariffs; how complex and integrated supply chains can be unpicked between the UK and the EU; and what support the UK government can – or should – provide manufacturers large and small.

Free Trade Agreements

Also speaking on the panel, Richard Corbett MEP, deputy leader of the Labour Members of the European Parliament, noted: “[I am] faced with my own extinction”.

He also spoke about the impact of Brexit on access to European Free Trade Agreements: “What is often neglected in this debate is the effect Brexit has on our trade with the rest of the world.

“At the moment through the EU we are party to over 50 trading agreements with third party countries that we negotiated as the EU, with the clout of the world’s largest market behind us. We are party to many mutual recognition agreements so that products do not need to be systematically inspected at borders.

“So, the first thing we would have to do as a separate entity from the EU is replace all of that, and it’s not likely to be simple and we are not necessarily going to find it easy to get a better deal than we do now.”

Integrated supply chains

On the issue of integrated supply chains saying, senior trade specialist with Amber Road, Arne Mielken commented: “Forty years of harmonisation have led to a very integrated UK in the European market and vice versa. This is especially true in manufacturing.

“What we see quite clearly is that re-evaluations of manufacturing supply chains are already taking place. We have also seen that mergers and acquisitions are taking place, as we’ve seen this week with Peugeot and Vauxhall. And what that means it that the ultimate decision making power of where these supply chains go, how they change, is no longer necessarily in the UK.

“Add to this the potential imposition of duty, but more importantly non-trade barriers and we may see that these supply chains may change in the future.”

Export strategy

Finally, Lesley Batchelor OBE, director general of the Institute of Export & International Trade, speaking about the practicalities of trade said: “The main point to consider is the sheer size of exports that will be growing from 90 million imports and exports each year, to 300 million per annum when we leave. And just think about paperwork that might be attached to that.

“Dealing with Europe was easy, and now dealing with the rest of the world – and treating the rest of Europe as the rest of the world – is going to mean compliance issues and paperwork. People won’t actually want to buy from us if our goods are held up at borders. But this isn’t doom and gloom – this is wake up and smell the coffee.

“We have got to get this right; we have got to start really understanding that this is a skill. We need to tap into the energy out there and we are going to get through all this, but let’s find out how to do it properly. Then we’ll do what the British always do – learn how to do it better than everyone else.”