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We are just weeks away from the current Brexit deadline but in reality we seem no closer to reaching a deal which satisfies the UK Government, UK Parliament and the EU. The threat of a no-deal Brexit lingers – whether on 31 October or, in the event of an extension, on a future date. The reality is, therefore, that manufacturers must prepare – those who have taken steps must ensure they remain prepared, and those who have more to do should do it now.

Preparing for Brexit: Deal or no Deal published by Make UK and Squire Patton Boggs explores the impact the Brexit delay has already had on manufacturers with most already reporting significant losses, both financially and in credibility terms.

64% of manufacturers say the Brexit delay and uncertainty has had a directly negative impact on their company's profit margin in the past two years

Almost half of manufacturers have already experienced a noticeably negative change in EU customer/supplier appetite towards doing business with them

The EU remains our largest single market for goods, with 49% of UK goods exports in 2018 heading to the EU

The message to Government is clear:
with just 2% of manufacturers believing a no-deal Brexit would positively affect our ability to do business with the EU, we must do all we can to avoid the irreversible impact a no-deal Brexit would have on UK manufacturing: Make UK calls on the Government to prioritise securing a deal with the EU as soon as possible.

This research must serve as a wake-up call to Government – business needs clarity and stability going forward, but that does not mean leaving the EU at any cost. 

No deal would leave manufacturing facing tariffs on the import of goods and just in time delivery logistics would become inoperable. Furthermore, business would be unable to access the people to ensure British companies can fill vacancies where they have skills gaps or, send workers to the EU for service contracts and other commercial opportunities.
Stephen Phipson CBE Make UK, CEO
A no-deal Brexit presents huge challenges to the UK’s manufacturing sector and the immediate implications for businesses in terms of cost and disruption will be serious. In particular, it is widely expected that many manufacturing businesses, particularly those that rely on just-in-time supply chains within the EU and those who may be impacted by the imposition of new tariffs, may scale back or close their UK operations.
Jeremy Cape Partner in the Brexit team at Squire Patton Boggs

76% of UK manufacturers feel that a no-deal Brexit would have a negative impact on the appetite of EU customers/suppliers vs only 2% who believe it would have a positive effect

Available resources

Brexit / Make UK / Industry report