Hello there!
Airbus Group has written to its 15,000 UK employees warning of the risks of a Brexit vote. Bosses sent the letter on Monday outlining fears that leaving the European Union could increase competition in the UK market.
While it said it remains "committed" to its UK operations whatever the outcome of the referendum, it said its success is based on a "highly competitive, integrated European business model". The letter, signed by six top Airbus Group bosses, including the president of Airbus Group UK Paul Kahn, said: "We simply don't know what 'out' looks like."
That's actually rather a worry isn't it? You would think these rather well compensated individuals would have something of a clue. While we cannot say exactly what the end result looks like, we can make some fairly accurate estimations.
For starters, we need to make it clear that the EU is not the single market. It is entirely possible to be a member of the single market without being a political subordinate of the European Union. In all likelihood we will remain a member of the European Economic Area (EEA). The reason being that it is absolutely impossible to unpick forty years of political and economic integration overnight. Brexit is a process, not an event.
Because the Lisbon Treaty exit mechanism (Article 50) allows only two years to negotiate, there is zero likelihood of Britain negotiating a bespoke agreement. Therefore, it will adopt an off the shelf agreement for expedience and continuity of of trade. The consequences of doing it any other way are unimaginable. In that regard, there is no possibility that we will end freedom of movement. It is a condition of single market access on the same terms.
Airbus has said that "our business model is entirely based on our ability to move products, people and ideas around Europe without any restriction and we do not believe leaving will increase the competitiveness of our British based operations."
The EEA agreement means no tariffs and no restrictions on the movement of people, goods or capital. It would be fair to say that Airbus operations are largely unaffected. More to the point, there is no change to the regulatory environment. Much of what you do in your daily lives conforms not to EU regulations but ISO standards and global regulations on aviation safety. (AP233)
In fact, the majority of EU regulation is adopted verbatim from international conventions or from global super regulators. It is a law taker, not a law maker. On these global bodies, the EU takes our vote and removes our right of reservation. For me the most compelling reason for leaving the EU is to have our own voice at the top tables, being able to shape the regulations before even the European Parliament gets a say.
Where Airbus is wholly wrong is when it says leaving the EU will not increase our competitiveness. The average EU trade deal takes several years. This is because the EU prefers deep and comprehensive trade deals that come with strings attached. As much as they take years, they are prone to stalling and are often watered down in order for them to pass.
Meanwhile, the rest of the world is moving more toward Partial Scope Agreements, whereby more agile operators can secure agreements on individual sectors or components, meaning they edge ahead by means of many small increments. This is why we see vehicle manufacture moving from the protectionist USA to Mexico. Mexico as an independent operator has 45 free trade agreements. Britain would be free to do the same. Presently trade agreements are an exclusive competence of the EU.
More to the point, for Airbus, who builds A320s in the USA, one of the most protectionist countries on earth; my own view is that it's a little disingenuous to suggest Airbus would be harmed by Britain becoming more outward looking, seeking to break out of the confines of Euro-parochialism.
The letter from Airbus states "We all need to keep in the back of our minds that future investments depend very much on the economic environment in which the company operates." - and this really is emotional blackmail that has no real basis in truth. What you are seeing is a prestigious political opinion, which is more the personal preferences of ill-informed executives. It holds no more accuracy or value than the loudmouth bloke in the pub.
There is so much more I would like to discuss in this note but I know how busy you all are. All I would really say is that this is a political question rather than an economic one, and Airbus has no more right to take sides in this than it does a general election. Some might argue that a Corbyn led government would have far deeper business ramifications for Airbus than Brexit, yet they would never dare intervene in a general election.
The real question here is whether it is your personal preference to be governed as a province of a supreme government for Europe, or whether you want to be an independent nation. Nobody is suggesting we end close ties with Europe and Brexit does not mean the end of cooperation. It just means we reserve the right to say no to EU diktats. That would be that democracy thing.
What I would say is that Brexit in truth has very little immediate economic impact, and most of you will be hard pressed to tell the difference. What it will mean is that Wesminster is back in control of key policy making for the future which will revitalise our democracy. That is the whole point of leaving.
That said, I am not going to insist you believe me. All I'm saying is that there is more to this than your employers would have you believe. They as a multinational with no real loyalty to anyone have their own agenda. Their opinion is just one among many. You have probably already noticed that the Leave and Remain campaigns are full of BS and frankly, I expect you will get more informed opinions from the men and women sat around you in the office than any of the politicians or corporate executives.
You should also remember where you are sitting right now. Filton airfield had a long history of pioneering aviation achievements long before even the EEC came along. You will have worked alongside people who worked on Concorde; a shining example of international cooperation. Britain has a proud tradition of aerospace accomplishments, and it's not because of political treaties or politicians. It's because of people like you.
All of you to my mind are some of the most dedicated and conscientious people I have ever known and you could not have been more welcoming. It is those qualities that will ensure both the UK and Airbus prospers whether we are in or out of the EU.
Brexit is not about saving money or shutting the borders. It's really about breaking free of this euro-deadlock and expanding our reach. More to the point it's about democracy. The right to say no to our government. That much is absolutely no business of a multinational corporation like Airbus.
If you are further interested in any of the points I have made, feel free to hunt me down on social media (@petenorth303) or read our fully comprehensive Brexit plan which details all the issues.
www.eureferendum.com/documents/flexcit.pdf
Regardless of how you may vote, I would like to convey to you how much of a pleasure it was to be part of Filton's final chapter as an active airfield, and how much I miss each and every one of you. We proved between us that it is our innovations and our ideas, and our ability to work around executive orders that gets things done. In that spirit, I would urge you to do as you have always done, and trust your own instincts over that of the bosses.
More to the point, for Airbus, who builds A320s in the USA, one of the most protectionist countries on earth; my own view is that it's a little disingenuous to suggest Airbus would be harmed by Britain becoming more outward looking, seeking to break out of the confines of Euro-parochialism.
The letter from Airbus states "We all need to keep in the back of our minds that future investments depend very much on the economic environment in which the company operates." - and this really is emotional blackmail that has no real basis in truth. What you are seeing is a prestigious political opinion, which is more the personal preferences of ill-informed executives. It holds no more accuracy or value than the loudmouth bloke in the pub.
There is so much more I would like to discuss in this note but I know how busy you all are. All I would really say is that this is a political question rather than an economic one, and Airbus has no more right to take sides in this than it does a general election. Some might argue that a Corbyn led government would have far deeper business ramifications for Airbus than Brexit, yet they would never dare intervene in a general election.
The real question here is whether it is your personal preference to be governed as a province of a supreme government for Europe, or whether you want to be an independent nation. Nobody is suggesting we end close ties with Europe and Brexit does not mean the end of cooperation. It just means we reserve the right to say no to EU diktats. That would be that democracy thing.
What I would say is that Brexit in truth has very little immediate economic impact, and most of you will be hard pressed to tell the difference. What it will mean is that Wesminster is back in control of key policy making for the future which will revitalise our democracy. That is the whole point of leaving.
That said, I am not going to insist you believe me. All I'm saying is that there is more to this than your employers would have you believe. They as a multinational with no real loyalty to anyone have their own agenda. Their opinion is just one among many. You have probably already noticed that the Leave and Remain campaigns are full of BS and frankly, I expect you will get more informed opinions from the men and women sat around you in the office than any of the politicians or corporate executives.
You should also remember where you are sitting right now. Filton airfield had a long history of pioneering aviation achievements long before even the EEC came along. You will have worked alongside people who worked on Concorde; a shining example of international cooperation. Britain has a proud tradition of aerospace accomplishments, and it's not because of political treaties or politicians. It's because of people like you.
All of you to my mind are some of the most dedicated and conscientious people I have ever known and you could not have been more welcoming. It is those qualities that will ensure both the UK and Airbus prospers whether we are in or out of the EU.
Brexit is not about saving money or shutting the borders. It's really about breaking free of this euro-deadlock and expanding our reach. More to the point it's about democracy. The right to say no to our government. That much is absolutely no business of a multinational corporation like Airbus.
If you are further interested in any of the points I have made, feel free to hunt me down on social media (@petenorth303) or read our fully comprehensive Brexit plan which details all the issues.
www.eureferendum.com/documents/flexcit.pdf
Regardless of how you may vote, I would like to convey to you how much of a pleasure it was to be part of Filton's final chapter as an active airfield, and how much I miss each and every one of you. We proved between us that it is our innovations and our ideas, and our ability to work around executive orders that gets things done. In that spirit, I would urge you to do as you have always done, and trust your own instincts over that of the bosses.
Best wishes,
Pete North.
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