Topic updates
Trade frictions inside and outside of a customs union
26th June 2018
This graphic displays one of the clearest contextual examples of trade frictions outside a customs union that you could possibly find. Gold dust for the classroom!
Honda is a prime exponent of just-in-time production. Consider this quote from the article if leaving the customs union threatens their model. "A warehouse capable of holding nine days’ worth of Honda stock would need to be... one of the largest buildings on earth"
Honda's supply chain:
— Linda Yueh (@lindayueh) June 26, 2018
Within the customs union, 5-24 hours to purchase a part from rest of EU
Outside the customs union, 2-9 days due to new import declarations, then 2 sets of customs clearance/border checks at EU & UK ports#Brexit #cars #supplychainhttps://t.co/6nySF7VR4i pic.twitter.com/8cjB7lHXqr
Honda explains to FT customs union exit impact on supplychain:
— Faisal Islam (@faisalislam) June 26, 2018
-Extra 24 hours on current 5-24 hours for production/ transport of parts within EU
- Extra 24-36 hrs entry clearance into EU for half of cars exported
- 3-6 days having to avoid congested Chunnel by shipping pic.twitter.com/T6DwRauYf8
Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.
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