The Brexit referendum thread: potential consequences for GB, EU and the Brits in CH

[lewton]

	Quote:	Aeneas
	More BS. Try responding to some of the rebuttals, like Jim2007's recent one, to your posts, if you have the courage. Doubt it.

You are hallucinating.
Jim2007 has not quoted any of my posts in the last few days.

[MusicChick]

	Quote:	fatmanfilms
	That is of course true, which is why the EU will be bankrupt & an irrelevance within a few years.

Big states are more likely to go that direction, than a pretty loose union of small, self governed states. EU does not have the ultimate power over their members. I would not think in absolute terms, especially now. If EU dies...so be it. Small states reshuffle and make something similar but better, me thinks.

[fatmanfilms]

	Quote:	MusicChick
	Big states are more likely to go that direction, than a pretty loose union of small, self governed states. EU does not have the ultimate power over their members. I would not think in absolute terms, especially now. If EU dies...so be it. Small states reshuffle and make something similar but better, me thinks.

The banks are bust & who will bail out the bankers & little people next time.

[fatmanfilms]

	Quote:	Jim2007
	And of course the U.K. will spend the next few years as you put it, negotiating an exit deal with the EU followed by an application to the WTO, leading to perhaps their signing of a first trade deal around 2022 if the are lucky...

I would not be surprised if the UK pulls out of talks for a deal with the EU, far better to let them suffer for a couple of years first. Your ignoring the advantages of a hard BREXIT for the UK.

[baboon]

	Quote:	fatmanfilms
	I would not be surprised if the UK pulls out of talks for a deal with the EU, far better to let them suffer for a couple of years first. Your ignoring the advantages of a hard BREXIT for the UK.

Yet again....47% of UK exports go to the EU. 13% of EU exports go to the UK. Who's gonna hurt most?

[Sbrinz]

The advantage of a hard Brexit is the the UK can fall back on simple WTO rules, without the EU bureaucracy for businesses.

The EU has made it clear that it doesn't want to punish the UK for leaving, but it does want the UK to pay for the commitments it has made...

Until we see the facts, we cannot decide. This is why I want another referendum when all the facts and costs are clear.

[fatmanfilms]

	Quote:	Sbrinz
	The advantage of a hard Brexit is the the UK can fall back on simple WTO rules, without the EU bureaucracy for businesses. The EU has made it clear that it doesn't want to punish the UK for leaving, but it does want the UK to pay for the commitments it has made... Until we see the facts, we cannot decide. This is why I want another referendum when all the facts and costs are clear.

Thats incorrect, it's been stated several times that the UK should be punished so that other countries don't leave as well. It's easy as words are cheap when the UK picks up more than 1/27th of the costs......... second highest payer.

[Pachyderm]

	Quote:	baboon
	Yet again....47% of UK exports go to the EU. 13% of EU exports go to the UK. Who's gonna hurt most?

And "yet again" can we point out that leaving the EU and (probably) the single market does not mean that we stop trading with the EU. Of course we will continue to buy their goods and they will continue to buy ours. There's no obvious reason for either side to want to take a hit by imposing hefty tariffs on the other.

The percentages may indeed change a bit if import-export rules change and make trade harder, but they are not going to go from 47% to zero, or from 13% to zero.

With the weaker pound, our exports are now tremendous value for money, so if anything we should expect to see our exports to the EU go up.

[baboon]

	Quote:	Pachyderm
	And "yet again" can we point out that leaving the EU and (probably) the single market does not mean that we stop trading with the EU. Of course we will continue to buy their goods and they will continue to buy ours. There's no obvious reason for either side to want to take a hit by imposing hefty tariffs on the other. The percentages may indeed change a bit if import-export rules change and make trade harder, but they are not going to go from 47% to zero, or from 13% to zero...

Never said it would go to zero. Just highlighting on which side the real risk is.

[fatmanfilms]

	Quote:	baboon
	Never said it would go to zero. Just highlighting on which side the real risk is.

I believe it's a risk worth taking, the EU is not a growth market, the result of so much protectionism over so long.

[lewton]

	Quote:	fatmanfilms
	I believe it's a risk worth taking, the EU is not a growth market, the result of so much protectionism over so long.

A question.
Of the goods that the UK exports to the EU at the moment, what part can instead be redirected to other markets?
Britain's geographical location is not very helpful. For instance let's take cars. At the moment several car manufacturers produce a number of cars in the UK and export mainly to the EU. Most of these manufacturers have production plants in the EU. Thus I expect them to gradually start producing in the EU for the EU market, since there are going to be trade barriers.
Back to the UK. Can you point to me which countries would buy the British-made cars? North America? Africa? Russia?
Germany will lose free access to a very big market that likes to spend good money on German cars, but at the same time Germany (along with France, Czechia etc,) will have the opportunity to sell to EU buyers who would have bought a British-made car instead.
At the end of the day, the devil is in the details. Germany might lose more than win, while Czech-made cars might win more than they lose. But the EU production plants as a total will not lose as much as the total volume that they sell to Britain today.

[fatmanfilms]

	Quote:	lewton
	A question. Of the goods that the UK exports to the EU at the moment, what part can instead be redirected to other markets? Britain's geographical location is not very helpful. For instance let's take cars. At the moment several car manufacturers produce a number of cars in the UK and export mainly to the EU. Most of these manufacturers have production plants in the EU. Thus I expect them to gradually start producing in the EU for the EU market, since there are going to be trade barriers. Back to the UK. Can you point to me which countries would buy the British-made cars? North America? Africa? Russia? Germany will lose free access to a very big market that likes to spend good money on German cars, but at the same time Germany (along with France, Czechia etc,) will have the opportunity to sell to EU buyers who would have bought a British-made car instead. At the end of the day, the devil is in the details. Germany might lose more than win, while Czech-made cars might win more than they lose. But the EU production plants as a total will not lose as much as the total volume that they sell to Britain today.

You miss the point that no trade deal is needed to sell to the EU. Apple manage to sell phones Chinese made phones in the EU, neither the US nor China has a trade deal. The £ has fallen by more than the 10% tariff on cars so a hard BREXIT is a better deal for selling cars than the day before the referendum.

[lewton]

	Quote:	fatmanfilms
	You miss the point that no trade deal is needed to sell to the EU. Apple manage to sell phones Chinese made phones in the EU, neither the US nor China has a trade deal. The £ has fallen by more than the 10% tariff on cars so a hard BREXIT is a better deal for selling cars than the day before the referendum.

Again, the devil is in the details.
Can the British factories supply all the necessary components or will they have to import from abroad? If they don't depend on imports then yes, they can produce at a lower cost thanks to the lower GBP (lower personnel costs).
Furthermore, if the British economy fairs well we can expect the GBP to bounce back, right?

Finally, iPhones cost much more per volume.
A Nissan Qashqai sells at about 30 thousand euros.
A container that is the Qashqai's size would contain several hunders of iPhones, each worth anything between 600-1000 euros (retail price). The ratio of the cost of shipping iPhones to their retail price is much smaller than for cars.
This is why Apple does not need to produce iPhones in Europe, while Japanese car manufacturers have built factories to produce here instead of importing from Asia.

[fatmanfilms]

	Quote:	lewton
	Again, the devil is in the details. Can the British factories supply all the necessary components or will they have to import from abroad? If they don't depend on imports then yes, they can produce at a lower cost thanks to the lower GBP (lower personnel costs). Furthermore, if the British economy fairs well we can expect the GBP to bounce back, right? Finally, iPhones cost much more per volume. A Nissan Qashqai sells at about 30 thousand euros. A container that is the Qashqai's size would contain several hunders of iPhones, each worth anything between 600-1000 euros (retail price). The ratio of the cost of shipping iPhones to their retail price is much smaller than for cars.

Shipping costs are not the issue, we have been shipping cars from Japan for over 40 years, they were always competitively priced & specced v the crap produced by British Leyland even in a protectionist environment.

[lewton]

	Quote:	fatmanfilms
	Shipping costs are not the issue, we have been shipping cars from Japan for over 40 years, they were always competitively priced & specced v the crap produced by British Leyland even in a protectionist environment.

Then why did they build manufacturing in Europe (including Nissan's plant in Sunderland)?

[marton]

	Quote:	lewton
	Then why did they build manufacturing in Europe (including Nissan's plant in Sunderland)?

They created a market by shipping in cars and then cut costs by starting manufacturing in Europe after the market was established.

[amogles]

	Quote:	lewton
	Again, the devil is in the details. Can the British factories supply all the necessary components or will they have to import from abroad? If they don't depend on imports then yes, they can produce at a lower cost thanks to the lower GBP (lower personnel costs). Furthermore, if the British economy fairs well we can expect the GBP to bounce back, rightd

Two things. Actually the uk has quite a lot of companies that make components for the car industry. This is one reason why cars are still being made in the uk.at all. Secondly, tariffs can be reclaimed on export. So if there is a tariff barrier against foreign parts, but the car gets exported, the value of the tarriff can be reclaimed.

[fatmanfilms]

	Quote:	lewton
	Then why did they build manufacturing in Europe (including Nissan's plant in Sunderland)?

Because of EU tariffs, 25 years ago when the £ pulled out of the ERM they warned there would be no further investment in the UK as they did not like the currency risk.

[lewton]

	Quote:	fatmanfilms
	Because of EU tariffs, 25 years ago when the £ pulled out of the ERM they warned there would be no further investment in the UK as they did not like the currency risk.

Great, so they decided to start producing in the EU in order to avoid EU tariffs, but this time they will decide to keep producing outside the EU despite the EU tariffs?

[fatmanfilms]

	Quote:	lewton
	Great, so they decided to start producing in the EU in order to avoid EU tariffs, but this time they will decide to keep producing outside the EU despite the EU tariffs?

Well UK car factories tend to be more efficient than French, Italian & Spanish factories, no strikes. I could go on....... oh & closing UK factories will have a huge write down so won't happen in the foreseeable future. I guess it will be down to if EU robots are cheaper than Chinese ones, Interestingly NIKON bought a small UK manufacture of robotic equipment.