At last! The Japanese speak out (but too late to stop disaster)

And so, at last, members of one of the major manufacturing sectors in the UK – Japanese car makers – backed up by their government, meet with our powerless Prime Minister to publicly express their concern at the direction in which Brexit is heading. In so doing they unambiguously emphasise that should it come to the hard Brexit that many in the Tory Party seem intent on visiting upon our country, the rationale for locating their facilities in the UK no longer holds. Therefore, they may as well move elsewhere.

For those of us who actually know something about how manufacturing works in a 21st century, globalised economy (and did do for many years before the 21st century), this was welcome news – though seriously belated. As someone who has lived in the East Midlands for almost all of the past forty years, and always been a bit of a petrol-head, I can still remember the buzz created by the news that Toyota were building a car plant not far from Derby. Indeed, I recall driving over to have a look at the plant as it was being built through 1990-1991. And nowadays I regularly see Toyota’s lorries on their way to and from the factory (they also have an engine factory at Deeside in North Wales).

I should add at this point that I’ve no great affinity with Toyota over any other car maker. I have owned several Japanese cars – and very good they were too – especially for the money when compared to equivalent UK or European makes. I was also lucky enough to be one of the few people at the time to learn to drive in a Japanese car, when my driving instructor bought a brand-new Datsun 120Y in 1975. What a revelation that was compared to my Mini 850, my mate’s Cortina Mk2, my grandfather’s Austin 1100, and all previous cars I’d experienced until then, and indeed for a fair few years after.

At the time Toyota arrived there was much talk about the alleged ‘inducements’ both central and local government had given the company to locate to where it did. But everyone I spoke to at the time knew the most important reason for Toyota’s arrival (and Nissan’s and Honda’s) was to give it ‘frictionless’ (to use the now fashionable term) access to the markets of the EU.

But Toyota’s arrival in the UK was also significant because they were heavily associated with ‘kaizen’ – continuous improvement – and just in time (JIT) production (subsequently labelled the ‘Toyota Way’). And by the time I became an academic in the mid-1990s there was a lot of interest – both academically and more generally – in the way in which Toyota was managed and operated (and indeed in Japanese manufacturing companies in general) and what Western companies could learn from them. These production and management principles – and especially JIT – have come to underpin almost all examples of large scale manufacturing. And this process is designed around and maintained through globalised, integrated supply chains. Fundamentally, therefore, if these systems are interfered with, blocked, or subject to uncertainty (i.e. Brexit) they can no longer deliver the production and cost benefits and, as importantly, the sales and marketing regimes – which flow from them. In short, they have to be reconfigured so that they do. There is no way around this.

Of course, there was very little reason why most of the citizens of the UK should know about or understand what JIT is or the nature of integrated supply chains. Indeed, knowing someone who works for one of the Japanese car manufacturers in the UK, even they are relatively ignorant about anything other than the processes they work with. But with policy makers and politicians there is little excuse, given these are subjects that are easy to research: a day ought to see an MP’s researcher discover enough literature to provide a decent overview of the subject and therefore why Brexit is such a no-brainer.

And yet it appears ignorance reins across government. Or, much more likely – and as with the various impact analyses – denial and deceit dominate. So, the Japanese finally speak out – having initially been bought off by whatever ‘promise’ was given to Honda. Perhaps they feel freer to do so than the CBI, Institute of Directors, and the various trade bodies and Chambers of Commerce, all of whom are natural Tory supporting entities and thus reluctant to voice any thought or opinion that runs contrary to a Tory government.

All of these cowed and cowardly entities have now woken up to the fact that what influence they thought they had on the Brexit process (i.e. a soft Brexit) has disappeared – replaced by the rabid views of The Mail, Telegraph and Murdoch’s dog-whistle rags, and the band of fanatics in government and the Tory Party whose view of the UK harps back to the empire and all they think once made Britain ‘great’.

‘The Japanese are coming’ was a slogan we once heard back in the day when the UK government (Thatcher no less) actively promoted the UK as a gateway to the EU. Well, our second women Prime Minister is now going to have another slogan to add to her less than illustrious collection: ‘The Japanese are going.’ To which some in her party will no doubt say, ‘good riddance’. But many thousands will pay the price, and many of them will live to rue the day they voted for Brexit.

Author’s Note: Toyota also have manufacturing facilities in France, Poland, The Czech Republic and Russia, all of which can be expanded – and will no doubt attract similar ‘inducements’ to do so to those offered by the UK government back in the 1980s.

Comments

  1. Peter May -

    Agreed entirely. But if the EU ties up legally the no border in Ireland bit, we cannot leave the EU. WTO rules prevent a border which is differentiated. So no border with the Republic equals no border with all of the EU.
    I reckon the Tories are lying to themselves, us and everyone else just to stay in power.

  2. Ian Stevenson -

    If only we had a free press instead one which is part of the media/finance complex, it could be possible to get the point across to all those who stuck in the view that leaving will make no difference or make us better off.
    I looked at the Telegraph headlines today and if i had no other source of information, I would feel we were being bullied by ‘elites’. In fact, the bullying is being done by a different elite.

    1. Ivan Horrocks -

      Indeed, Ian. But that too is part of the Brexit con trick, and, as you say, if your sole source of information is the Telegraph or any other of the Brexit rags you’d have no way of knowing. The again, I suspect a lot of people of a certain age aren’t interested. They have their memories of the 50s and 60s (preferably only the years of Tory governments of course, and forgetting the shitty years of rationing) and that’s another ‘golden age’ they see us heading back to.

  3. Sean Danaher -

    Its a big worry in the NE with Nissan Sunderland being a major employer, famously opened by Thatcher and hailed as a beacon for the Single Market. 80% of the production is exported to Europe. I can’t see it doing well.

    Some of the local Leave literature had a Nissan logo before they were forced to remove it.

    1. Ivan Horrocks -

      My brother in law works at the plant, Sean. After Brexit he was totally convinced that Nissan were ‘only bluffing’ about moving if things didn’t pan out. He may well have changed his mind now.

      1. Nile -

        Have a quiet conversation with your brother about the work he sees around him, and whether there are quite as many temps and contract workers as there were a year or two ago.

        Is there still a steady flow of new, improved components and new processes? Kaizen, the continuous improvement of production, needs continuous investment: is there any sense, perhaps, that we’re falling ever such a little bit behind due to an unstated unwillingness to put money into a facility without the future cashflows that would pay it back?

        Does it seem that less and less of what they make goes out to other plants, and less and less of every car that rolls off ‘our’ assembly line is made of locally-produced components?

        Are your best managers and your most promising technicians quietly being posted to the other manufacturing facilities. in Europe?

        You could easily not notice – or choose not to see – a gradual reduction in activity that would’ve made the headlines if it happened all at once.

        1. Ivan Horrocks -

          Interesting questions and observations, Nile. That’s the way these things happen: keep it below the radar.

  4. Donald Liverpool -

    Toyota also has a manufacturing plant in Russia which can be expanded. I wonder how they are handling not being in the EU, SM or CU.
    Still, if it helps you deal with the sadness of losing, carry on blaming the decision, and not those elected to carry it out.

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