There are two sides to every automotive story, including ‘Brexit’

12-Aug-2019

We are only a matter of a few days away, reminds Iain Robertson, from a departure from the European Union, with ‘No Deal’ on the cards and a shaky new administration headed a politician who has finally got the job he always craved.

Achieving a balance should always be the aim of any responsible organisation. Achieving comfortable profitability, based on a ‘goods-in:goods-out’ strategy that seeks constancy and stability should always be the aim of a responsible manufacturer. The UK motor manufacturing industry has been a paragon of supportiveness in its time, fully aware of its responsibilities to its 169,000 employees and 800,000 staff in its blend of supply and delivery chain.

When critics decry the UK motor industry, accusing it of no longer being British, while there may exist some ‘accounting anomalies’ that have been aided and abetted by both financial institutions and our politicians, in the main, foreign ownership does not always infer that UK Limited Liability status is not worth the paper upon which it is ratified. These firms pay their taxes. They invest in the UK economy (£4bn net capital; £2.3bn in R&D…some of which is from the taxpayer). From an annual turnover of around £75bn, they export goods worth c. £35bn, or 12% of the UK’s total exports. It is an industry that is reliant on its European neighbours, not least because 69% of UK car imports come from their factories, with 56% of our cars headed to their markets. This is not chicken feed.


While government has been coerced into supporting the industry financially, on occasion even nationalising aspects of it, it has usually been the result of that balance having slipped out of kilter. Influencing factors have lain invariably at the door of marketing departments and their ‘push:push’ strategies that always seek to sell more, even when there is no capacity for the excess. 

From around two million new and eight million used transactions carried out annually in a car park of just over 38 million total vehicles, it needs to be remembered that we are a small island cluster with a population just shy of 67 milliion. Even with an ‘unknown’ number of immigrants, it is abundantly clear that our nation is almost at its natural capacity, a factor that can be measured by the strain under which health, education, social services, environment and even defence have been placed. There are arguments pinpointing ‘under-investment’ by our administration in each of those fields but, with almost half of the nation’s working age population being employed by government and its various departments (however tenuous), perhaps more attention should be paid towards government ‘cutting its own cloth’.

Ever since former PM Cameron dumped the ‘in/out’ vote upon us, the result of which was surprisingly, if precariously balanced, and ‘did a runner’, because not-in-a-million-years did he and his various colleagues believe that departure could be on the cards, we have been fed an unceasing diet of ‘how bad things will be for us, when we depart the EU’, a socialist construct that is designed to erase sovereignty and even dent democracy most damagingly. It is not often that we hear the positive values. There have been many benefits to the UK’s membership of the EU, not least in cross-border accessibility, without tariffs and penalties.

Yet, the EU, somewhat inevitably, has behaved with what it believes is professional decorum, while we were being led up a garden path to Mrs May’s rosy-lensed idea of collaborative heaven. The truth is, our political elite, on either side of the equation, have behaved churlishly and, often, childishly, like a spoilt teenager, constantly aware of future employment potential in a body to which six-figure salaries are not in a rarefied atmosphere. It is abundantly clear and has become increasingly so that those seeking to destroy the balance are the only people, who can emerge from this debacle in a better state.

Yet, were the near 70% of imported new BMWs, Mercs, VWs, Renaults, Fords, Vauxhalls and Peugeots that populate our roads every year stopped at the UK borders, it would not take a brain of Britain to appreciate that the German, French, Italian and other EU members’ economies would soon be placed under breaking strain…and this is just for cars. While much sabre rattling and ridiculous stand-offs continue to occupy the headlines of a largely left-wing media in the UK, it should also be abundantly clear that trading arrangements would soon be rushed onto the negotiating table.

To a certain extent, I feel a degree of sympathy for the EU (not European) administration, which is in in serious debt and continues to be dragged down by other economies that have been ‘trading as insolvent’. As ‘Francis Urquhart’ would have proposed, the ‘House of Cards’ is set to tumble regardless and that scenario is actually more damaging than any little ‘Brexit’ deal. The bottom-line is that our polarised society is also a surprisingly well-balanced one, a factor evinced by our centrist politics and other balancing aspects. I am sure that the coming months will be challenging to say the least but things will settle down quite speedily and I feel certain that we shall all be the better off for it.
 
 
 
Motor Industry Snippets

The real cost of EVs

While accepting that electricity costs are lower than fossil fuels (not the case, when using electricity supplied by a gas, coal, or oil-fired power station!), you should be interested in the brilliant table (below). There are loads of myths yet to be busted about the EV scene and the costs aspect is but one of them. It is intriguing to note that the most expensive new cars are also among the most efficient on the list.

 

Seat continues to buck trends
The Spanish arm of the immense VW Group is still establishing UK sales benchmarks, even in a depressed market. Seat is presently 7.8% ahead of its year-on-year performance and, in the month of July, when its rivals posted decreases in turnover, it had grown by 6.7%. While its product range remains dependent on VW corporate decisions, it is managing to carve a growing niche, despite the fact that it was a brand without a future only four years ago.
 
BMW celebrates its 60th with 10 million Mini sales
If you dip into our motoring archive (under ‘Features’), you will find the driving impressions of the latest, 60th Anniversary Mini. Coincidentally, although BMW seldom bothers about muddying the historical waters, the 10 millionth Mini has also been produced, for which the Munich giant takes full credit naturally. Interestingly, between 1959 and 2000, no less than 5.3 million original Minis were produced, apparently with not a bean of profit being made on any of them! BMW has now produced 4.7 million versions of the car in the past 19 years and, with UK list prices creeping into £40,000 territory, the German firm is making money on every unit.
 
Nissan Juke declared as all ages gamechanger
The quirky and (some would say) grotesque Nissan Juke crossover model that is produced at its Sunderland factory has emerged as the car possessing the widest appeal to drivers of all ages. It is convenient that it should top a poll, just as a new and significantly more conventional model is due to be launched. It has become the most popular crossover in the UK, since its introduction nine years ago, appearing consistently in the UK Top 10 best-sellers’ list.
 
EV movements continue to impress
Be under no illusion, despite reported financial problems with Elon Musk’s Tesla company, the successful pan-European introduction (if late to market) of the more affordable (from c.£35,000) Model 3 has led to it topping EV registration charts in several countries. As brazen as ever, Musk has announced that its larger Models S and X (both costing over £100k) can now be obtained with zero-cost electricity charge cards. Musk also states that his firm’s battery developments, at the Silicon Valley, Californian HQ, are now aiming at 620-miles range for the next Tesla Roadster.