The UK needs to rebuild trading relationships and quickly to avoid losing major ground in the global defence market, according to industry figureheads. Brexit is expected to have a major impact on businesses, with military and aerospace organisations currently considering their commitment to a United Kingdom outside the EU.
In 2014, the UK was behind only the US in terms of exporting new military hardware, with the business worth around £8.5 billion per year. ADS Group, the trade organisation representing the British aerospace, defence and security industries, is disappointed with the decision to leave.
"The aerospace, defense, 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,” said Paul Everitt, the CEO of ADS Group.
Rolls-Royce, which employs around 23,000 people in the UK, has warned that the long-term impact of Brexit remains to be seen, while Airbus has a slightly more brutal outlook. "The world will not stand still, nor will Europe," Airbus Group CEO Tom Enders told Reuters in an email. "Britain will suffer but I'm sure it will focus even more now on the competitiveness of its economy vis-a-vis the EU and the world at large."
What’s more, analysts are also predicting major cuts to the British defence budget, with IHS Jane's anticipating a £2.3 billion reduction in annual spending on the armed forces in the year 2020. Which is a bit ironic, seeing as a huge proportion of Leave voters probably pleasure themselves to the thought of the British military zapping foreigners in dusty, faraway lands. [CNBC]