The company warned against creating ‘immigration barriers’
Alexander Dennis Ltd has said that a hard Brexit could damage future growth, The Scotsman reported.
The company said the impact of Brexit on the currency markets was already driving up costs of production, with CEO Colin Robertson stating that components imported from the EU make up around half of every bus rolling off UK production lines.
He said failure to agree a tariff-free customs deal after Brexit would harm its business.
Colin also warned the government against creating further immigration barriers between the UK and the EU, as ADL was already struggling to recruit enough skilled engineers and needed access to talent from across Europe.
Colin said: “We have some protection in that Alexander Dennis operates on a model where our production is spread around the world. Operations in those countries won’t be affected by any tariffs the UK might face after it leaves the EU.
“However, our ability in the UK to source precision-engineered components such as axles and gearboxes from within the EU is a concern. Depending on the specific model, up to half of the components in each vehicle are sourced from outside the UK, and most of that comes from the EU.
“With the fall in the value of the pound, the exchange rate has already pushed up prices. We’ve been able to guard against that to an extent through foreign exchange hedging, but if those costs continue we will eventually have to pass them on to our customers.”