Jaguar Land Rover, Britain’s largest car maker and automotive employer, has warned the Government a bad Brexit deal would cost the carmaker “more than £1.2bn profit each year” and cast uncertainty over 40,000 UK jobs.

JLR’s chief executive, Dr Ralf Speth, says the company’s “heart and soul is in the UK”, but that it faces an “unpredictable future if the Brexit negotiations do not maintain free and frictionless trade with the EU and unrestricted access to the single market.”

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JLR has also warned that £80 billion of UK investment, planned over the next five years, would be put “in jeopardy” if Brexit causes the “wrong outcome” to materialise. 

If the UK crashes out of the EU customs union without a deal, World Trade Organisation (WTO) export tariffs of 9.8 per cent would be applied to cars, dramatically affecting UK-based auto manufacturers’ operating margins. One in three cars exported from the UK is a JLR product, while the company sells 20% of its vehicles in Europe. 

Dr Speth warned not only of JLR job losses: the company has close trading relationships with a number of UK companies, with a total of 300,000 jobs involved in the JLR supply chain. Speth said for the company to remain “competitlve” and protect these jobs, “we must retain tariff and customs-free access to trade and talent with no change to current EU regulations.”

Speth’s remarks come ahead of publication of an expected Government White Paper on post-Brexit EU trade, and follow similar warnings from other automotive bosses. BMW recently assembled a task force to plan for a worst-case scenario Brexit, while the Society of Motor Manufacturers and Traders (SMMT) has previously highlighted 856,000 people work in the UK automotive sector, which is responsible for 10 per cent of the country’s GDP.

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