LONDON (Reuters) – British aircraft engine manufacturer Rolls-Royce (RR.L) said he was continuing with contingency plans as uncertainty grew that Prime Minister Theresa May's Brexit plan will receive parliamentary support.
PHOTO FILE: Warren East, CEO of Rolls-Royce, poses for a portrait at the company's aerospace engineering and development site in Bristol, Great Britain, December 17, 2015. REUTERS / Toby Melville / File Photo
"This agreement is just a draft," Warren East CEO on BBC radio said on Friday, joining a host of industry captains who urge politicians to be pragmatic and not to silence an agreement that allows trade between the United Kingdom and the EU to continue to flow.
"We will continue with our contingency plans and we will include reserve stocks in order to have all the logistical capacity we need to continue our business".
Manufacturers like Rolls-Royce fear new customs duties and bureaucracy that could threaten the just-in-time delivery of thousands of parties on which they depend if Britain crashes from the European Union on March 29th.
The May office has issued statements from several major companies such as Diageo (DGE.L), the London Stock Exchange (LSE.L) and Royal Mail (RMG.L) in support of its agreement.
The British pound recovered losses as May clung to its Brexit plan, and the FTSE 100 .FTSE and the FTSE 250 .FTMC of Great Britain both recovered, increasing by 0.2 and 0.3 percent, respectively. after the strong sales on Thursday.
But it is still grappling with the biggest crisis of its premiership following the resignation of key ministers as a protest for the draft agreement, and faces a tough battle to get parliament through if it survives.
"The political situation remains uncertain", the German carmaker BMW (BMWG.DE) said late Thursday, adding that he will continue to prepare for the worst case scenario, which is what would represent a Brexit without agreements.
The mini BMW plant in Oxford represents 13% of the total production of cars in Great Britain, with around 220,000 cars built there last year.
The Scotch Whiskey Association, which represents one-fifth of all UK food and drink exports in value terms, said that a contract-free Brexit would cause "significant difficulties" for the industry and increase costs and complexity .
Reporting by Costas Pitas and Elisabeth O & Leary; written by Georgina Prodhan; editing by Guy Faulconbridge and Jane Merriman