Ford’s Europe president says a no-deal Brexit would be an ‘absolute disaster’ for the car industry

Ford's Europe, Middle East and Africa president has said a no-deal Brexit would be an "absolute disaster" for the auto industry.

Speaking at a conference in London, Steven Armstrong said Ford was already "spending money on no-deal plans that we may never need" to avoid a cliff edge in which the UK leaves the EU without a deal.

He said businesses needed a transition period to avoid a no deal.

"However, the longer it takes to ratify the agreement and remove the spectre of the March “cliff edge”, the more business must trigger contingency plans. Ford is already spending money initiating ‘no deal’ plans that we may never need.

“It’s also critical that the first priority for the next stage of negotiations must be to secure frictionless trade. We have been consistently clear that any customs friction – including that inherent in a Canada-style arrangement – between the UK and EU would not support our Just In Time manufacturing system, undermining the competitiveness of our operations in the UK.”

Ford is one of a number of businesses that have warned against a no-deal Brexit. 

Earlier this week the Society of Motor Manufacturers and Traders (SMMT) issued a plea to MPs to back Theresa May’s deal as it issues fresh warnings against the impact of a “no-deal” Brexit.

A survey unveiled at its 102nd annual dinner last night revealed that three quarters of carmakers fear a no-deal Brexit will threaten their long-term viability.

Fewer than 9 per cent could seen any positives in leaving the EU without a deal, while almost a third of respondents said they had postponed or cancelled UK investment decisions because of Brexit.

SMMT chief executive Mike Hawes said: “Leaving without a deal would be catastrophic – plants will close; jobs will be lost. Leaving is not what we wanted, but we recognise that the withdrawal agreement has been hard-fought and, crucially, delivers a transition period which steps us back from the cliff-edge. We need a deal now, and we need an ambitious deal for the future that guarantees frictionless trade with our most important market – nothing else will do, and we urge all parties to remember what’s at stake."