Government must make five-point pledge to save UK car industry - SMMT

The government has been challenged to adopt a five-point pledge to secure the future of the UK’s electric car industry by the Society of Motor Manufacturer and Traders (SMMT). The plan comes as part of an industrial strategy that puts car making front and centre of the transition to net-zero.

The SMMT strategy would support the industry’s drive to meet government electrification targets, and guarantee mobility for all through a ‘right to charge’ that mandates delivery of public charging and refuelling infrastructure through binding targets. The government must also ensure that a fair system of motor taxation and duties is implemented, to encourage the switch to zero emission vehicles and provide long term certainty and affordability to consumers.

If the government fails to act, the UK will lose out on a £106bn ‘prize’ in the form of a 10-fold increase in battery electric vehicle production, as rival countries invest to support their industries. This hard-hitting verdict comes in a new manifesto launched by the SMMT at its annual summit in London today.

The UK trade body’s ‘Manifesto 2030’ calls for cross-party support for measures designed to recognise the importance of car manufacturing in the UK, which it says would create conditions for the UK to make three-quarters of a million electric cars annually, worth £106bn to the national economy.

“Such growth is contingent on British plants attracting the next generation of electric models and scaling up an emerging EV supply chain, a process which puts the competitiveness of the sector into focus,” the SMMT says. “As the sector consolidates its post-pandemic recovery, it faces fierce global competition as other countries offer huge cash incentives and subsidies to attract green manufacturing.”

The poor current competitiveness of the UK’s auto industry is largely down to government inaction on various fronts, the SMMT report implies. As well as the threat of imminent tariff changes coming into force in six months if left unaddressed, it points to the UK’s sky-high energy prices putting the brake on UK car industry investment. “The UK automotive sector faces electricity costs more than double those of EU rivals, with the added challenge of long lead times to secure essential new grid connections for renewable investments,” it claims, adding that action on energy cost should be “the number one priority”.

“The government has set the industry tough targets and we are committed to meeting them,” said SMMT chief exec Mike Hawes. “But we are in the middle of the most fiercely competitive investment landscape of a generation and need a UK response, urgently, using every policy, every fiscal and regulatory lever, to make Britain the most attractive place to invest.”

With an election and a possible change of government coming in less than 18 months, Hawes makes it clear the challenge is one that all political parties must commit to meeting.

“Back us with the right conditions and we will turn our obligations into opportunities for our industry, for jobs, for the environment and for the UK,” he said.

The Five pledges demanded by the UK auto industry

1. A Green Automotive Transformation Strategy for a stronger economy

Publish a Green Automotive Transformation Strategy that supercharges UK Automotive to achieve net zero. A strategy which enables innovation, attracts investment and secures manufacturing of clean technologies in the UK to deliver economic growth and zero emission mobility.

2. Net zero mobility for everyone

Foster a reliable and affordable UK-wide recharging and refuelling network through binding targets complemented by a motor tax and regulatory system that ensures no one is left behind in the transition to net zero.

3. Green skills for a greener future

Offer the skills workers want, by creating a one-stop-shop national upskilling platform, and develop the future talent that business needs, combined with greater STEM education in schools and a dynamic immigration system that attracts global talent.

4. Made in Britain – Made for the world

Position automotive and advanced manufacturing supply chains at the core of UK trade policy and market access. Secure access to global markets for tariff-free export of British-made vehicles, batteries and green technologies, and deliver export support services that allow businesses of all sizes to succeed.

5. Powering the UK clean tech revolution

Ensure net zero-critical industries such as automotive are able to access affordable and internationally cost-competitive zero emission energy to power the clean tech revolution. Dedicated energy and investment measures should be available to make zero emission vehicle production and use a reality.

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