Leading firms and organisations are calling for calm and for the government to consider carefully the decisions to be made over the next few months.
The political establishment and financial markets have been left reeling after 52% of the UK’s population voted to leave the EU, against a 48% vote to remain in a referendum that saw a high 72% turn out.
Engineering and industrial organisations, many of which led calls for the UK to remain part of the EU, have reacted this morning with surprise and concern across all sectors of British industry.
Donald Tusk, president of the European Council, said: “There's no hiding the fact that we wanted a different outcome of yesterday's referendum. I am fully aware of how serious, or even dramatic, this moment is politically. And there's no way of predicting all the political consequences of this event, especially for the UK. I want to reassure everyone that we are prepared also for this negative scenario. As you know the EU is not only a fair-weather project.
“I would also like to reassure you that there will be no legal vacuum. Until the United Kingdom formally leaves the European Union, EU law will continue to apply to and within the UK. And by this I mean rights and obligations. All the procedures for the withdrawal of the UK from the EU are clear and set out in the Treaties.”
Terry Scuoler, chief executive of the EEF said: “We need a clear vision for a new relationship between the UK and the EU, but we must also avoid throwing the baby out with the bath water. In the complex task of unpicking the UK from EU regulation and legislation, the Government must tread carefully, keeping if we can a trading relationship with the single market, avoiding dramatic overnight changes and not becoming bogged down to the detriment of making long-awaited and much-needed decisions on projects vital to our future economic prosperity.”
Stephen Cooper, head of industrial manufacturing at KPMG UK, said: “There are significant implications for the supply chain, such as the application of tariffs. On the jobs front, there are very real implications to the access to engineering talent. Manufacturers will need to consider their strategy.
“Investment decisions, both FDI and of UK origin, whether put on hold waiting for this vote or in the ‘normal’ course of business, will need to be reappraised. Whether manufacturers will choose to locate or develop their operations in the UK, with the possibility of tariffs in place, remains to be seen.”
“We should not lose sight of the fact that this result can also lead to opportunities for manufacturers; a drop in the value of sterling could make the UK a magnet for trade, and the need to reshape trade policy may result in quicker decision making, and reduced red tape.
Paul Kahn, president of Airbus UK, said: “We respect the decision taken by the British people, which should be seen as a wake-up call for Europe and as a catalyst for change.
“We will work with the UK government to minimize any impact on our operations. While we are disappointed, clearly we will continue to support our workforce and operate our UK facilities. We will study the longer term consequences of this decision on the competitive environment.”
Mike Hawes, chief executive of UK automotive sector trade body the Society of Motor Manufacturers and Traders, said: “The British public has chosen a new future out of Europe. Government must now maintain economic stability and secure a deal with the EU which safeguards UK automotive interests. This includes securing tariff-free access to European and other global markets, ensuring we can recruit talent from the EU and the rest of the world and making the UK the most competitive place in Europe for automotive investment.”
Paul Everitt, chief executive of aerospace and defence trade association ADS Group, said: “The Aerospace, Defence, Security and Space industries will work with government to minimise the negative impacts of the decision to leave the EU, creating an environment in which these strategically important sectors can continue to prosper.”
Mike Thompson, chief executive of the Association of the British Pharmaceutical Industry, said: "This creates immediate challenges for future investment, research and jobs in our industry in the UK. With that being the case, we are committed to working closely with the government to agree what steps need to be taken to send a strong signal that the UK is open for business."
Carolyn Fairbairn, CBI director-general, said: “Many businesses will be concerned and need time to assess the implications. But they are used to dealing with challenge and change and we should be confident they will adapt.
“The choices we make over the coming months will affect generations to come. This is not a time for rushed decisions.”
Mike Cherry, national chairman at the Federation of Small Businesses, said: “We call on the government for clarity on the impact to smaller firms who export wider afield through EU FTA agreements.
“These are crucial questions that need to be answered swiftly to ensure the UK’s 5.4 million small business confidence does not fall any further, which is already at the lowest levels since 2013.
Naomi Climer, president of the IET, said: “We thought it hugely important that the role of UK engineering was considered as part of the EU debate.
“We looked carefully at the issues affecting engineering, including the skills shortage, the global markets that engineering is a part of, research funding and global standards.
“We concluded that, at a time when we have a huge shortage of engineers, limiting the number of professional engineers that could come and contribute to our economy would affect the industry and the nation’s financial wellbeing.
“The result of the referendum is clear and we are calling for an urgent discussion so that any negative impacts can be mitigated for the benefit of UK engineering and our country’s economy.”
Dame Ann Dowling, president of the Royal Academy of Engineering, added: “It is vital that the economy is carefully managed in the wake of the Brexit vote in order to maintain our world-leading position in innovation and industrial development.
“We will continue to work with partners both within and outside of the European Union to make the UK a leading nation for engineering innovation, and to help address the global challenges of our time.”
Dr Christos Tsinopoulos, senior lecturer in operations & project management at Durham University Business School, said: “Brexit repercussions for the UK manufacturing industry will be questioned by many over the next few weeks and months. What we do know is that the integration across a supply chain is king. … To make this happen there needs to be a degree of standardisation in legislation, systems, policies, and even engineering methods. Over the last few years this has largely been facilitated by several European bodies. Many have been guided by the EU whereas others have been industry led. The result has been some highly integrated and efficient supply chains which have benefited many of us.
“The good news here is that given the high degree of integration of many of them they are relatively difficult to change in the short term. The bad news however is that in the medium and longer term there would be a higher incentive to do so. In a competitive environment where small changes can have significant impact on performance and relationships, switching between supply chains and countries may become an increasingly popular choice.”