Ford Blames Brexit Uncertainty For Huge European Profit Decline

Ford has blamed the uncertainty over Brexit for a huge drop £760 million ($974 million) in European earnings.

The American automaker says that it will take “whatever action is needed” to protect its business and pointed the finger at falling confidence in the UK and potential long-term damage caused by its withdrawal from the European Union, The Independent reports.

Executives from Ford say that £470 million ($602.75 million) of its drop in earnings are due solely to the drop in the value of the British pound since the Brexit referendum in mid-2016.

As recently as April, Ford executive vice president of global markets, Jim Farley, said the car manufacturer was committed to Britain through Brexit talks, pointing out positive signs in ongoing negotiations with the European Union.

In the months since, however, the EU has refused most of the UK’s plans to secure access to the single market without accepting all of the market’s rules.

All of the car industry is concerned.

Ford isn’t the only marque with serious concerns. Speaking on the issue, McLaren chief executive Mike Flewitt expressed similar fears about how a no-deal Brexit will impact its business.

“What will happen on the first day of no deal? How will we be able to import components? Export cars?

“Well… we don’t actually know how to trade with each other under those terms,” he said.

“These are genuine fears. The people I feel most sorry for are some of the car companies that came and invested in the UK through the 1980s and 1990s to make Britain their base for trading in Europe.

“If all of a sudden their trading terms change, that whole investment is almost called into question.”