Just a very quick thread on one of the inevitable issues on the trade deal- as the experts are trying to summarise on Christmas Day....

From the POV of manufacturing, which I love.

So the zero-tariff thing means that there won't be a tariff barrier on trade between the UK and EU. The NTB's will be substantial, as will delays due to (pointlessly) being outside the CU. This will bleed JIT manufacturing white, and it will dwindle to nothing.

So Nissan may stay open a while yet- don't know- but it'll add grit to the machine and make other plants a default best choice at a time when automotive demand is very weak. It bodes ill.

My biggest concern is this: CRITICAL MASS.

Any manufacturing business consumes many parts and services in making its own products- be that tyres, wiring and glass for cars, or plastic mouldings, cables etc in household appliances. To obtain these locally (i.e. in the UK), requires an ecosystem of small businesses

That ecosystem is driven by diversity of demand. One injection moulder, employing say 30 people, might supply a hundred customers in radically different sectors, but it's always 1 or 2 customers who drive 40% of demand.

The bedrock customers.

In the UK, that bedrock is automotive & aviation. Because we're jeopardising those sectors because some pensioners were fooled by a bus, that bedrock WILL crumble.

This is much worse news for the ecosystem than the headlines have you believe. It's DDT for business.

That 40% disappears. Without that steady stream of revenue, the small business implodes. We already have a very high average age in the UK, and this is doubly reflected in SME ownership.

These owners are 55+ and they aren't going to try again.

They don't have time.

When that moulder (or press shop, or whatever) stops, it'll hurt the 100 other customers, who then have to expend time and effort resourcing. Worse than that, it might be the *last* company of its kind in the area.

Birmingham is a shadow of the industrial powerhouse it once was; but if I need a part, I am confident I can find a company to make it- but in 2021?

It is at the very bottom end of critical mass. When it loses its last supplier of one kind or another, it starts to fail

That's why Shenzhen in China thrives. Labour isn't cheap anymore. 5 years ago you could pay $200/month for a factory worker. It's now $800 and climbing every year.

BUT! You can purchase every widget, sprocket and thingy within an hour of your plant. Literally anything.

Taiwan is the same; Germany & NL too. They have critical mass, and are growing.

When the UK drops below critical mass, you'll see a staged collapse.

It's avoidable, stupid, and now baked-in.

It's millions of SME jobs, 20 here, 50 there.

But our tariff-free access to the EU means we'll keep buying BMW's, Bosch dishwashers etc. But UK exports will be hamstrung with systemic supply chain problems.

Eventually UK manufacturers- starting with the most sophisticated- will up sticks to somewhere less hostile.

Brexit means an increasingly geriatric, xenophobic population, mired in bigoted ignorance, killing their offspring's life chances AND preventing them from leaving for a better life elsewhere.

All enabled by a cabal of ideologues and chancers.

And when these lightweight pseudo-intellectuals tell us "we'll have to wind down manufacturing", they don't tell us what they're going to replace the jobs with. Because in their world, Government doesn't intervene in the "workings of the market".

Which is sadism in a suit, not policy.

I'm so very tired. We're going to lose the last manufacturing ecosystems, we have nothing to replace it with, and the sadists in charge "forgot" to ask for access for the service industry in the EU, so that'll choke too.

Happy New Year everyone.

My company will do OK- we've already moved whatever operations we could to the EU, but there'll be more in time, and I am well positioned, personally, to be part of that. But if you keep tolerating sadism as policy, the UK will never recover.