One way to build a healthy export-based manufacturing sector with plenty of UK jobs is via the license-to-build economy.
One of the great things about Brexit will be the opportunity for the UK to sign trade deals with any country in the world and some of those trade deals may be quite innovative in nature. Novel trade opportunities shouldn’t be discounted simply because no one has ever done them, but such deals should be judged on their own merits.
In the age of the 3D-printing technology for example, there’s no reason why a company in America can’t electronically transmit code to a 3D-printer in the UK, allowing the UK company to manufacture the item there. Of course, this means that the UK company must pay a license fee to the American company, but think of the convenience! Not to mention instant access to the item in the UK, and it means jobs at both ends of the equation. If you’re concerned about the CO2 emissions involved in shipping a part (or a number of parts) from America to the UK, you’ll appreciate the fact that transmitting a few hundred lines of computer code creates only a fractional amount of CO2.
Even better, is the case for cars and trucks to be built in the UK under license from American automakers.
For example, Ford Motor Company may choose to sell millions of automobile VIN numbers (basically, the serial number of each car or truck) and the complete instruction set for building and assembling each car or truck, to a UK company that specializes in building Ford vehicles. The UK company would pay a per-vehicle license fee to Ford Motor Company U.S.A. and agree to maintain the same high manufacturing standards of the American automaker and it would be required by Ford U.S.A. to adhere to the same warranty terms and conditions.
But still! Think of the CO2 savings, think of the jobs created in the UK, think about the UK building all Ford cars and trucks in the UK for the domestic market and exporting millions of those built-under-license vehicles to Commonwealth countries that have right-hand drive cars. That market, the right-hand drive car and truck market in the Commonwealth of Nations, would become the UK’s ‘beat’ and Ford would grant exclusive rights to the UK company to sell millions of Ford cars and trucks throughout the entire Commonwealth. (Note: Canada drives left-hand drive cars like the U.S., so Canadian cars would continue to be produced in the NAFTA countries)
So far, I’ve only talked about Ford vehicles. But what if it was all vehicles?
What if all American, Japanese, Korean and EU car manufacturers decided to make the same amount of profit per car as they do now, but only needed to sell a VIN number and the ‘vehicle blueprint’/computer code for each car to a UK manufacturer in order to do so? Ergo, all right-hand drive cars destined for UK and Commonwealth customers would be built in the UK and exported, where necessary, from Bristol.
What if it was more than cars and trucks?
What if Airbus, Boeing and Lockheed Martin sold per unit license fees to UK manufacturers, along with Bombardier and Embraer? What if Caterpillar heavy equipment and Toshiba and Hyundai Heavy Industries sold per unit license fees to UK companies? Yes, those companies would earn the same profit per unit as they do now — by selling only the license fee and VIN number and the technical aspects to the UK company — which, in turn, would manufacture those units within the UK and offer them for sale in the UK and to Commonwealth of Nations countries exclusively.
I’m still not done! What if everything sold in the UK was manufactured in the UK? How many jobs would that create?
What if you wanted a right-hand drive Mercedes CLA 250 4MATIC coupe? And what if you could simply order it from Mercedes online, and the Mercedes Benz approved manufacturer would fly you from anywhere in the UK to the factory in Bristol to pick up your new car, right off the assembly line. Some people might like to arrive a day early to watch their own car being built to their own option specifications. Then, you could take a nice leisurely drive home in your brand new car and not have to pay £2000 in shipping costs to get the car delivered from Germany, as is the case now.
What if you wanted an ACER computer, or a Lazy-Boy brand reclining chair? What if you wanted a Texas A&M hoodie for walks with your dog in cool weather? Get one for the dog too, is my advice, you’ll look great together! Or, what if you wanted the latest Italian cookware? Now, what if you could simply buy what you wanted, but it was manufactured in the UK under license from the original manufacturer, and in so doing, you received it sooner, with lower shipping costs, and far lower CO2 emissions — compared to the item being manufactured overseas and then shipped to the UK?
And what about companies in the UK making those items (and many more!) for Commonwealth of Nations consumers — which will number 2.5 billion by 2022?
Great for exports and great for those countries! Why? Well, assuming the UK government doesn’t blow this once-in-a-lifetime opportunity, there won’t be enough labourers in the UK to build all those cars, trucks, forklifts, computers, furniture, t-shirts, medical instruments, dishwashers, etc., etc., etc., and the UK will need to import Commonwealth workers to keep up with demand. Which itself, will help Commonwealth nations improve their per capita, disposable income — meaning, they’ll have more opportunity to afford such items.
Yes, via the UK hiring Commonwealth workers for UK assembly plants, people from Commonwealth nations will then have more money to spend on UK-manufactured goods, goods that might well be assembled by their very own children who work in the UK during their gap year between high school and university. Even mature workers from Commonwealth nations should be able to gain a UK work visa for one-year, to earn some British sterling, thereby advancing their own family finances, and find themselves better able to purchase a UK manufactured car or other item once they return home.
Just because it hasn’t been done before, doesn’t mean it can’t be done.
Just look at what JFK did… he promised America would put a man on the Moon by the end of the decade, and he succeeded in that. Nobody else was doing it, but that didn’t mean it couldn’t be done.
All the UK needs now is for a JFK-like leader (either in UK politics or a captain of industry) to do what nobody else is doing and make this thing fly. Many will say it can’t be done, but I don’t believe it for a second. Only mediocre people say things can’t be done.
So, stop talking about it, and get it done!
Because if you think you can dither and delay for 3.5 years like you did with Brexit, don’t bother trying, as you’ll soon find that every country in the world has beaten you to the punch and it will no longer be worth doing.
by Edgar Albert Guest
Somebody said that it couldn’t be done
But he with a chuckle replied
That “maybe it couldn’t,” but he would be one
Who wouldn’t say so till he’d tried.
So he buckled right in with the trace of a grin
On his face. If he worried he hid it.
He started to sing as he tackled the thing
That couldn’t be done, and he did it!
Somebody scoffed: “Oh, you’ll never do that;
At least no one ever has done it;”
But he took off his coat and he took off his hat
And the first thing we knew he’d begun it.
With a lift of his chin and a bit of a grin,
Without any doubting or quiddit,
He started to sing as he tackled the thing
That couldn’t be done, and he did it.
There are thousands to tell you it cannot be done,
There are thousands to prophesy failure,
There are thousands to point out to you one by one,
The dangers that wait to assail you.
But just buckle in with a bit of a grin,
Just take off your coat and get to it;
Just start in to sing as you tackle the thing
That “cannot be done,” and you’ll do it!
And this is the attitude sorely lacking in recent generations. In my generation (yes, I know what that sounds like) our generation arrived at the best plan and got right to it.
We left our egos at the door, we left our personal lives at home, and we got the job done on-time and on-budget — or we were judged by our peers to be ‘not worth spit’.
And while that modality may seem harsh to some, it’s the best way to build a rocketing middle class economy, it’s the best way to create a thriving family lifestyle, and it’s the best way to stay ahead of our competitors who aren’t in the business of working for our best interests.
‘All for one and one for all, must henceforth be Britain’s clarion call’ if post-Brexit Britain is to succeed!
John Brian Shannon serves on the Editorial Board at kleef&co. John has contributed to the United Nations Development Program and to corporate blogs. Presently writing about Brexit at: LetterToBritain.com