Carmaker Honda’s announcement that it is to close its Swindon factory with the loss of 3,500 jobs has sparked a debate about whether Brexit is partly responsible.

Honda itself said no.

But Greg Clark, the Business Secretary, gave the impression that he didn’t really believe them, when he spoke in the House of Commons.

Mr Clark has consistently and vocally warned about the dangers of a “no deal” Brexit.

Unlike some colleagues who say this can be avoided if Prime Minister Theresa May takes the prospect “off the table”, he’s argued that the only way to avoid a no-deal Brexit is for the House of Commons to approve a deal.

But he’s also raised a second, related point. This is the fact that with just over a month to go before Brexit is due to take place on March 29, we still don’t know what’s going to happen.

And that uncertainty is making overseas firms reluctant to invest in the UK, according to Mr Clark.

In other words, even if the UK does eventually agree a deal, the fact that we’ve waited so long to do it is causing harm to the motor industry now.

Honda insisted its decision was not related to Brexit in a statement from Ian Howells, the firm’s senior vice-president in Europe.

The Nissan factory in Sunderland
The Nissan factory in Sunderland

He told the BBC: “We’re seeing unprecedented change in the industry on a global scale. We have to move very swiftly to electrification of our vehicles because of demand of our customers and legislation.

“This is not a Brexit-related issue for us, it’s being made on the global-related changes I’ve spoken about.

“We’ve always seen Brexit as something we’ll get through, but these changes globally are something we will have to respond to. We deeply regret the impact it will have on the Swindon community.”

But Mr Clark didn’t sound convinced.

Speaking to the House of Commons, he said Brexit was “an additional worry” to Honda.

Mr Clark said: “The company said that the decision was not about Brexit and clearly we must accept that.

 

“In truth, it has a small market share in Europe compared with the markets in which it said it was expanding. Those are the reasons that it has given.

“However, I have always been clear with the House that the motor industry, ​Japanese investors and particularly Honda have made it clear for many months that Brexit is an additional worry at a difficult time.

“They have been instrumental in shaping the deal that has been negotiated. If there is one message all of us in the House can give that they want to hear it is that the deal should be ratified.”

He went on to say: “Although Brexit uncertainty was not cited as one of the factors in the decision, it is evident in investment decisions in the whole industry. I know from regular conversations with investors that it does bear on their minds.

Greg Clark

“Last time I was in the House, I mentioned that Nissan has said that the political uncertainty over a no-deal Brexit, or what kind of Brexit there will be, is ‘casting a shadow’ over its future.”

Mr Clark also told the House of Commons that the Japanese ambassador had warned that the UK’s failure to make a decision about a Brexit deal was damaging the confidence of Japanese investors.

According to Mr Clark, the ambassador said in a letter: “What Japanese businesses in Europe most wish to avoid is the situation in which they are unable to discern clearly the way the Brexit negotiations are going, only grasping the whole picture at the last minute.”

Mr Clark, of course, is a Conservative. His views were echoed by some Labour MPs.

 

Richard Burden, Labour MP for Birmingham Northfield, said: “Brexit may not have been the direct cause of Honda’s announcement, but .., does the Business Secretary agree with me that it is an absolutely key part of the context in which Honda and other major car manufacturers are making decisions on where to invest in the generations of vehicles that will transform this industry?

“The harsh reality is that Britain’s reputation as a stable place to do business and as the gateway to Europe is being undermined before our eyes.”

Jack Dromey, Labour MP for Birmingham Erdington, added: “Our 850,000-strong automotive industry is a world-class success story, and ... nothing should be done that puts it at risk by those who would be oblivious to the consequences of their actions and take this country crashing out of the European Union on 29 March without a deal."

Labour MP Luciana Berger announces her resignation from the Labour Party at a press conference on February 18, 2019 in London

Westminster has been gripped this week by the emergence of The Independent Group, a centre-ground group of MPs (not yet a formal party) made up of defectors from the Conservative and Labour parties.

But next week there will once again be a series of votes on Brexit.

In the past, MPs have been good at making it clear what they are against. They voted against the Prime Minister’s deal, against delaying Brexit and against a proposal put forward by Labour leader Jeremy Corbyn to have a debate and vote on a second referendum.

This time, perhaps at last they will give carmakers some certainty and agree on what they are actually for.