WHILE attention in Scotland was understandably focused this week on the body blow to the Dundee economy from the planned closure of the Michelin tyre plant, there was another big automotive-sector announcement by a European player that rang alarm bells for a post-Brexit UK.

French giant Michelin has signalled that its decision to close its Dundee plant, with the loss of hundreds of jobs, is not Brexit-related but is instead to do with the impact of cheap imports from Asia.

But the other automotive-industry announcement this week, by German giant Schaeffler, had a lot to do with Brexit.

And it seems inevitable there will be some more big announcements of this type over the coming weeks and months as companies react to Brexit, either by implementing contingency plans before the final outcome is known or by reacting to what is agreed, or not, between the UK and European Union.

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It is crucial to remember that, even if there is a deal, many overseas companies with operations in the UK will have to decide whether or not the loss of membership of the single market warrants them scaling back or closing their plants. After all, certainly in the context of exporting businesses, EU membership will surely in most cases have been high on the list of reasons why these companies located operations in the UK in the first place.

Ball bearing-maker Schaeffler, in a move affecting hundreds of jobs, plans to close factories in Plymouth and at Llanelli in Wales in the next couple of years.

Production will shift to Germany, China, South Korea and the US.

Around 85 per cent of the goods produced by Schaeffler in the UK are exported, mainly to continental Europe. Albeit politely, Schaeffler made it plain that Brexit, while not the “single decisive factor” behind the closures, had been a significant influence.

Juergen Ziegler, the Schaeffler manager responsible for European operations, said: “Brexit is clearly not the single decisive factor behind our decision-making for the UK market, but the need to plan for various complex scenarios has brought forward the timing.”

The response from trade union Unite hit the mark.

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Unite assistant general secretary Tony Burke, describing the closures as a “body blow for the UK’s automotive supply chain and the wider car industry”, declared: “It should leave no one in any doubt as to what is in store if the UK crashes out of the European Union without a deal that secures tariff-free frictionless trade.”

There have been a raft of warnings from the car-manufacturing sector about Brexit in general. These have been starkest in relation to a no-deal outcome but they have been applied by company chiefs to a range of scenarios. Basically, the last thing car manufacturers operating in the UK need is anything that compromises frictionless free trade with members of the European single market. Among those to have spoken up on Brexit are Japanese car giant Nissan and Jaguar Land Rover.

Ralf Speth, chief executive of Jaguar Land Rover, has warned “tens of thousands” of jobs could be lost in the UK car industry if the Westminster Government fails to strike the “right Brexit deal”.

The deal or no-deal speculation is swirling ever faster, as the clock ticks down towards Brexit.

All the while, the consequences of Brexit have already been manifesting themselves in myriad ways, including a tumble in net immigration to the UK from other EU countries and an intensification of skills shortages, even before we get to the actual exit door.

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The results of a survey conducted for The Herald last week at the Institute of Directors in Scotland’s annual conference at Gleneagles made interesting reading.

Nearly three-quarters of leaders of Scottish businesses and public sector, third sector, and social enterprise organisations now believe a no-deal Brexit would trigger a UK recession. And 87% fear the consequences of a no-deal Brexit.

Of those surveyed, 30% forecast there would be a no-deal Brexit. And 85% think Brexit, under whatever scenario, will exacerbate skills shortages.

The skills shortages question underlines the point that a deal, if one is struck, would merely mitigate to a relatively small degree, rather than ward off, the huge economic and societal damage to the UK arising from Brexit.

The Michelin announcement shows the extent of the challenges faced by the UK amid increasing globalisation. Such challenges are best tackled as part of a powerful trading bloc such as the EU.

We must, meanwhile, recognise the considerable damage already done to the UK by the Brexit vote.

Surveys published this month by the Chartered Institute of Procurement & Supply signal the UK economy ground towards a halt in October. These surveys – of the services, manufacturing and construction sectors – were consistent with a quarterly growth rate of just 0.2% for UK gross domestic product.

And they signal that optimism in the UK private sector economy is the weakest since the immediate aftermath of the Brexit vote. Excluding July 2016, optimism is at its lowest for six years.

As the Conservatives bicker among themselves, the Irish border issue remains unresolved and the Democratic Unionist Party – which is propping up the UK Government – looms in the background, you get the impression that many business leaders are dismayed at the continuing chaos at this late stage.

Some will be moving to implement their contingency plans, given how close we are to Brexit next March.

As the UK Government refuses to see sense and call time on the whole Brexit folly, it seems we have got to the unfortunate stage that people might be forgiven for thinking that a deal will mean in some way that the Brexit problem has somehow been solved. Far from it.

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That is not to understate the importance of avoiding an utterly chaotic, cliff-edge Brexit.

But it is utterly crucial to recognise, given Prime Minister Theresa May and her Cabinet are absolutely determined to leave the single market and customs union, that all a deal can do is mitigate the huge and unnecessary damage that will be done to the UK over the months and years ahead by Brexit.