Toyota warns of potential pullout from Britain on no-deal Brexit

Toyota warned that it may end manufacturing in the UK if the country crashes out of the European Union on unfavorable terms, joining other automakers reviewing their operations in Britain as negotiations toward Brexit drag on.

"If the business environment becomes very difficult to operate, of course those types of decisions should be on the agenda," Johan van Zyl, the Japanese company’s head of Europe, told reporters at the Geneva auto show on Wednesday. "But hopefully we will be able to avoid" a withdrawal, he said.

The Toyota executive’s comments follow Nissan's decision last month to renege on plans to build the X-Trail SUV in England and Honda's announcement to end production in the country in 2021. Britain has long been a Japanese hub for European auto production, with Honda, Nissan and Toyota owning three of the country’s six largest factories.

Toyota pledged an investment of 240 million pounds ($316 million) in 2017 to produce the new version of the Corolla in England and upgrade its vehicle platform.

Last year the automaker built 129,070 Corolla hatchbacks and wagons at its plant in Burnaston, central England, according to its website. Toyota also has a plant in Deeside, Wales, that produces 1.6-liter and 1.8-liter gasoline engines. The Welsh factory built 308, 415 engines in 2018.

Toyota remains hopeful the UK and EU will reach an agreement on Brexit terms, van Zyl said.

“If there is a bad Brexit, we will need to look at future investments,” he said. The carmaker may need to make decisions about the production of the next Corolla before the current version reaches the end of its model cycle in about 2023, he said.