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Time To Hoard, Panic Buy?

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There are reports of shortages(car parts shortage) stopping production at Honda.

 

https://www.theguardian.com/business/2020/dec/08/honda-warns-port-congestion-could-cause-production-halt

 

According to the boss of Europe’s largest haulage trade body, the UK is looking at a “nightmare scenario” that will lead to “weeks, if not months” of food shortages after the Brexit transition period comes to an end in just four weeks.

So they can blame it on COVID or Brexit, but no doubt people will start to panic buy.

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Read all about it!  Manufacturer has to change its business processes or Britain will run out of Japanese cars. 

 

https://www.bbc.co.uk/news/business-55230469

 

"The situation is currently being monitored with a view to restart production as soon as possible," Honda said.

It is looking at other arrangements such as air freight."

 

It's a business, it will survive.  It's not going to stop manufacturing cars, it will, like all major businesses adapt. 

 

See they & others have had similar problems before in other countries.  The following from 2015

https://www.airfreight.com/blog/honda-toyota-nissan-turn-air-freight-port-issues-impact-supply-chain

 

So they ready have experience of resolving such problems. 

 

Plenty of Japanese cars on show the last time I was in the US a few years ago. 

 

As to your initial question, "Time To Hoard, Panic Buy?" Well that's down to 

 

A. The individual & whether they want to be selfish or not? 

B. It depends on what product(s) you're speaking of?

 

While we might, struggle in the short-term to get our hands on a clutch for an Accord, we're not going to run out of bread, milk & toilet rolls. 

 

Nothing to see here, move on. 

Edited by Baron99

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There are huge problems in the logistics world at the moment and similar port issues can be seen in other countries, the US being a good example.

It’a a perfect storm of business rushing back to place big orders in China after lockdown and the Xmas shipping peak meaning much higher container numbers. This has also resulted in a lack of containers in China for all the goods that are produced and ready to ship, so there are lots of delays separate to the ports issue.

The shipping companies have also restricted capacity (taken vessels out of service) to intentionally increase freight prices which are now 3 times higher than earlier this year.

Add to that firms preparing additional supplies for Brexit, a new booking system at Felixstowe that hasn’t worked, a lack of lorry drivers and the ineptitude of the civil service in trying to set up their own distribution network for 11000 containers of PPE rather than  using a specialist logistics firm, and it all adds up to a perfect storm.

 

I’ve also just heard that airfreight has become really limited as governments have booked most spare capacity to transport vaccine supplies.

 

Expect no major improvements until after Chinese New Year I’m afraid and prices will increase due to the higher freight charges.

 

Post Brexit we probably need to accelerate the growth in our ports capacity in the UK which could provide a boost to some of the more disadvantaged coastal areas.

 

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2 hours ago, Baron99 said:

It's a business, it will survive.  It's not going to stop manufacturing cars, it will, like all major businesses adapt. 

 

 

For me its more a case of:

 

It's a business being inconvenienced. 

It will look to where its not being inconvenienced or costs it extra money.

It will adapt by leaving the UK.

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I've got over 100 bags of 10 kilo coal stored in one of my barns because the UK Government decided last year to ban the sale of bags of coal in retail outlets from next February.  I have no worries about any other shortages in January but will continue to build up my stockpile of coal due to a decision our own Government made.  

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4 minutes ago, West 77 said:

I've got over 100 bags of 10 kilo coal stored in one of my barns because the UK Government decided last year to ban the sale of bags of coal in retail outlets from next February.  I have no worries about any other shortages in January but will continue to build up my stockpile of coal due to a decision our own Government made.  

They banned coal to encourage greener fuels.  Since you pretty much always support the Government and their aides regardless of what they do I'm surprised that rather than stockpile coal you didn't destroy it as a symbol of pure devotion.

Edited by Arnold_Lane

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51 minutes ago, alchresearch said:

For me its more a case of:

 

It's a business being inconvenienced. 

It will look to where its not being inconvenienced or costs it extra money.

It will adapt by leaving the UK.

With the new EU - Japan trade deal the forecast is that long-term all car production will switch back to the Japanese factories as there is no need to have a factory within the EU to avoid tariffs now so it’s probably a matter of when not if Honda closes the plant. Brexit will probably accelerate it if there is no deal.

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30 minutes ago, Westie1889 said:

With the new EU - Japan trade deal the forecast is that long-term all car production will switch back to the Japanese factories as there is no need to have a factory within the EU to avoid tariffs now so it’s probably a matter of when not if Honda closes the plant. Brexit will probably accelerate it if there is no deal.

Long-term, there will not be the volume of demand for personal cars, that there was once was and still is to some extent. At least in Western Europe and the US. Personal transportation is getting further commoditized as ICE is transitioning to EV and personal cost of ownership keeps rocketing upwards.

 

Brexit outside the CU/SM will accelerate the decline of automative industry (-currently under way already)  in the UK regardless of whether there is a deal, today or next week or next year.

 

It's JIT logistics permitted by CU/SM membership, and mothership investment, that keep (kept) UK assembly lines competitive. Once CU/SM membership went out the window as regards the UK's post-Brexit life, that race was run.

 

Likely UK plants will gradually shrink to service the domestic market (and the RoI), then eventually shrink further as they change hands time and again in DeLorean- and Grenadier-like specialist/low volume ventures.

 

But we digress. About hoarding or panic buying: this late in the day, it's a self-fulfilling prophecy tbh. Not for bare essentials like those already mentioned by Baron99 above, but for the choice of alternatives, and nice-to-haves.

 

If you are on any specific meds that are imported into the UK from EU manufacturing sites or warehouses, however, maybe get worried enough to enquire with your GP/pharmacist...

 

...keeping in mind that you might not get the truth, and nothing-but-the-whole-truth, in reply.

Edited by L00b

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14 minutes ago, L00b said:

Long-term, there will not be the volume of demand for personal cars, that there was once was and still is to some extent. At least in Western Europe and the US. Personal transportation is getting further commoditized as ICE is transitioning to EV and personal cost of ownership keeps rocketing upwards.

 

Brexit outside the CU/SM will accelerate the decline of automative industry (-currently under way already)  in the UK regardless of whether there is a deal, today or next week or next year.

 

It's JIT logistics permitted by CU/SM membership, and mothership investment, that keep (kept) UK assembly lines competitive. Once CU/SM membership went out the window as regards the UK's post-Brexit life, that race was run.

 

Likely UK plants will gradually shrink to service the domestic market (and the RoI), then eventually shrink further as they change hands time and again in DeLorean- and Grenadier-like specialist/low volume ventures.

 

But we digress. About hoarding or panic buying: this late in the day, it's a self-fulfilling prophecy tbh. Not for bare essentials like those already mentioned by Baron99 above, but for the choice of alternatives, and nice-to-haves.

 

If you are on any specific meds that are imported into the UK from EU manufacturing sites or warehouses, however, maybe get worried enough to enquire with your GP/pharmacist...

 

...keeping in mind that you might not get the truth, and nothing-but-the-whole-truth, in reply.

Agree with most of this and a good and sensible point made about ‘nice to haves’.

Supply chains will adapt in the medium to long-term and luckily in the UK we have one of the best and most competitive grocery supply chains in the world to do this.

The industry just needs clear direction about what the new rules are then it can the put plans into place, I’m guessing we will know what’s what by the end of this week or possibly today.

I’ve been spending a lot of time through work looking at new tariff regimes and it’s quite interesting, both in terms of opportunities and barriers.

You can clearly see where tariffs existed for the benefit of other countries within the EU  where they still have a domestic industry (and we don’t), getting rid of these should be a priority for the government - one benefit of not producing much ourselves I suppose.

On food and drink  there will be lots of new opportunities but it’s whether people are willing to change their regular shop to more non-EU produce.

Also with the right investment and conditions from government the UK farming industry could supply more domestically. 
The flip side to this is that export industries reliant on EU business will obviously suffer., and sadly some of those businesses are high wage and significant in their local areas such as car production.

In the business I work  we source around 30% of our goods in the EU and 50% from Asia. there will definitely be cost pressures due to additional duty rates and then on top of that tariffs if there is no deal. However, there are ways to mitigate some of these extra costs in the short term and if the right trade deals are struck then long term things should be fine.

The Asian regional partnership would be the one to focus on for me. If you are a massive net importer you may as well go direct to the cheapest source and it also includes high value technology manufacturers like South Korea so the savings could be significant.

Many of the goods imported from the EU to the UK originate in Asia anyway so it makes no sense to pay double duty rates, better to go direct or buy from a UK importer.

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4 hours ago, Baron99 said:
As to your initial question, "Time To Hoard, Panic Buy?" Well that's down to 

 

A. The individual & whether they want to be selfish or not? 

B. It depends on what product(s) you're speaking of?

The individual shopper does not know whether the supermarket can restock or not, it is not selfish to hoard.

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Thanks for a well considered post, Westie1889.

 

I'll not reply (too much-) further here, as it would be off-topic and there's a dedicated Brexit thread, but it's just nice to read someone's pragmatic assessment and thoughtful considerations :)

 

But background for background, I'm in (heavily-exported) international legal services, and there weren't any opportunities to any form of Brexit pre-ref,  and there still aren't 4 years on. Just an unavoidable reduction in service capacity (likewise in the associated turnover from exporting same), by automatically losing rights of audience through exiting the EU jurisdictional framework. Hence decision to Brexode after the Art.50 letter in 2017, when the UK Sheffield firm I was working in, wasn't bothered about mitigating the predictable impact.

 

I''ve been on Continent 2.5 year now, and right now we're taking over the EU work of all UK branches of our international group (one of top 5 in UK in our field), and getting an EU27 colleague parachuted in from a Scottish office next week, to help with the workload. They left it a tad late :D

 

Edited by L00b

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32 minutes ago, El Cid said:

The individual shopper does not know whether the supermarket can restock or not, it is not selfish to hoard.

yes, it is selfish to hoard..

 

are you wanting us to justify some of your actions?

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