Engineering Group Siemens Says New U.K. Investment Decisions On Hold
The U.K. head of Siemens (SIEGY) warned on Friday that the German company will put decisions on investment in Britain on ice as a result of the uncertain post-Brexit climate.
In an interview with the BBC, Juergen Maier said the group remains committed to the U.K. but that he is worried about the prospects for future investment.
"Short term, in terms of any investment decisions you want to make here, especially those that result in exporting to the European Union, they will be on ice," he said. "No question about that."
Maier did not rule out future investment altogether, but he made it clear the business case for investing in the U.K. will be less attractive "until we know what the trading arrangement is going to be."
The U.K. would have to be able to show that its innovation and skills were stronger than elsewhere to justify investing in the country if trade was going to become more difficult.
The interview comes just days after Siemens said it had put plans on hold to export wind turbine blades from a new £310 million ($412 million) factory it is building in the northern English city of Hull. While investment in the factory will continue, and the facility will begin producing blades and assembling turbines next year reports say the plant will be supplying turbine blades for wind farms which are being built with substantial sums of EU money.
Neither Siemens U.K. nor the head office in Munich, Germany were immediately available for comment on Friday. But Siemens issued a statement immediately after the referendum result last week stating that it was now a matter of urgency for the government to sort out its relationship with Europe.
"Siemens has always made it clear that this was a decision for the British people and their view must be respected," the statement said. "As a global business with significant, long-term investments in the UK and high local value creation, Siemens is not so much exposed to negative effects [...]. Nevertheless, the government must now move swiftly to unify and agree the nature of the UK's relationship with the EU and other trading partners, creating clear roadmaps to encourage future investment."
The political turmoil that has erupted in the U.K. following the Brexit vote has likely made the goal of a swift agreement less attainable.
Siemens' U.K. business, however, remains one of Britain's largest manufacturing groups, generating revenue of around €4 billion ($4.44 billion) a year, and employing about 14,000 people at 13 sites around the country.
Siemens' Frankfurt-listed stock was down about 1.3% late morning on Friday at €91.34.