Cowdery said*: “We've been studying the impact of Brexit for some time. The Italian business has been working closely with the UK business to understand the impact. Clearly, there's still uncertainty in terms of the type of Brexit that will take place, but Leonardo has taken a position and formalised it [recently] with respect to trying to ensure that we have the best Brexit conditions in order to continue the operations between UK and Italy.”
Like many companies in the aerospace industry, Leonardo is keen to avoid a no-deal Brexit.
Cowdery added: “We have a lot of transfer of material between Italy and the UK, particularly in the helicopter business where we have integrated certain manufacturing processes to allow the best effective build line. We want those to be retained, so we want to minimise the impact of customs tariffs, and we'd like to see a limited impact on the way in which we do business today."
In July, Italian think-tank IAI published a whitepaper on what Brexit means for joint defence programmes in Europe. It envisages three different Brexit scenarios and was launched at an event at Leonardo's headquarters in Rome.
Leonardo has around 7,000 employees in the UK.
Cowdery noted the importance of aerospace of Leonardo to the UK economy: “Clearly we have a very large manufacturing base in the UK, which means we have a very integrated supply chain that supports that manufacturing base. So, about 60% by value of products that are built and supplied by Leonardo come from support from the supply chain. That supply chain is very diverse, and is located in various locations across the UK.”
He concluded: “We've recently completed an exercise with an independent company to look at the value added from Leonardo to the overall UK economy – particularly looking at Leonardo Helicopters, but also Leonardo Electronic Defence. What we found is that for every £1 of direct cost, we're able to generate, through gross value added, £2.30 to the UK economy, which shows that Leonardo is an important contributor to the overall defence revenues of the United Kingdom.”
* This interview was filmed in July 2018.