Brexit May Force The British-Built Mini To Be A Thing Of The Past

Factory

Mini isn’t joking around anymore. Either regulators put up soft barriers or it will leave the UK.

Mini may not be making such a huge splash in the news, but with 200,000 units coming out of its Oxford, England factory and a British workforce behind it, the brand still has plenty of foothold in the UK market, enough to make an impact if anything were to happen to it. After we heard that the fifth model in Mini's “five superheroes" plan was an electric car appearing in 2019, it was certain the automaker would catch the wave of electric car sales and ride it to a high water mark, though The Telegraph is claiming that the plan is in jeopardy.

It all has to do with Brexit. Depending on how talks between the UK and EU go, there could be a “hard Brexit” that would erect thick trade barriers between the two regions or a more subdued version that allows leeway for companies to import and export goods and services with ease or even exchange workers without as much issue. The location of the production facility for Mini’s upcoming electric car all rides on which way these talks sway, but if fans of the brand want to keep Minis British, they'd better hope it's at Oxford. "We hope for pragmatism from all parties in the Brexit negotiations,” said Mini chief executive Harald Krueger. “That means no new barriers to trade, free movement for skilled workers.”

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Though Mini has a few supplemental production facilities elsewhere, the Oxford factory is its central plant, but it's future, as well as Mini's fate in the UK, is at risk. If Brexit talks dissolve into harsh and trade-restrictive laws, Mini could decide to build its electric car at one of its parent company BMW’s German or Dutch production facilities rather than invest in expanding the Oxford plant. If that happens, it could begin a downward spiral for the Oxford facility where subsequent Mini models are built outside of the UK at other BMW facilities to make them easier to ship abroad. Ultimately, this could erode the Oxford plant's relevance and, as The Telegraph argues, could lead Mini to abandon it entirely.

“We are planning in terms of scenarios,” Mr. Krueger told shareholders. “You know that we make Mini models at VDL Nedcar in the Netherlands. We're flexible.” Krueger’s words make sense, but they also read like threats, warning both the Brits and EU to take businesses into greater consideration during the UK exit. The UK would not be the only party to suffer. UK buyers consumer more EU-made goods than the EU consumes UK-made products, placing the Union at a potential loss. Our best hope at a future of British-made Minis lies on the shoulders of negotiators currently hashing out the deal, though whichever way you cut it, Mini, other regional automakers, and the UK and EU as a whole stand to lose from an economic perspective.

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