A landmark week for UK industry
The publication of an Industrial Strategy on Monday – one with automotive at its heart – is the policy framework the sector has long-fought for and government has now addressed. Such a strategy – long-term, cross-Government and aligned to a trade strategy (itself published Monday) is the basis on which the UK automotive sector can regain its global competitiveness. The Strategy begins to address some of the challenges our sector – like so many others – face including energy, infrastructure skills and access to finance. The fact that there are not just ample references to automotive throughout the document but specific sections including “Drive35” which brings together some of the measures Government is taking to support the industry, underscores the importance with which Government holds our sector.
Coming in the week in which SMMT held its 17th International Automotive Summit, these announcements could not have been more timely, and my thanks go, in particular, to Rt Hon Jonathan Reynolds MP, Secretary of State for Business and Trade, who has been a champion of our sector and set out to a sold-out crowd how important we are to the government’s plans for growth.
Making the UK the best place for automotive investment now depends on implementation, and implementation at pace, because those decisions are being made today against a backdrop of fierce competition and geopolitical uncertainty. The latest vehicle production figures issued today show just how tough the environment is, with output down for a fifth consecutive month in May.
Model changeovers, restructuring and the impact of US tariff uncertainty on shipments across the Atlantic – down more than half in May – were chiefly responsible. It was critical, therefore, to have the UK-US trade deal signed and set to take effect next Monday, given its importance as a market for our world-class small volume, high value manufacturers.
Free and fair trade is fundamental to our success and balanced trading relationships that break down tariffs and regulatory barriers to trade – as targeted by the new trade strategy – will enable automotive companies to grow and get great British products into the hands of consumers all over the world, boosting jobs, business and prosperity at home.
For exports to remain competitive, we must also look closer to home by addressing the UK’s high cost of energy, together with reskilling and improving access to finance, especially for SMEs. This will enable the sector to invest in the technologies, the products and the people that will give the UK its competitive edge. Indeed, as our new report, The Competitive Edge: Driving Long-Term UK Automotive Growth, which features SMMT’s first UK Automotive Business Leaders Barometer, sets out, there is the potential for us to provide an additional £50 billion economic windfall, delivering the UK’s net zero ambitions, while returning the UK to the top 15 of global auto manufacturing locations for the first time since 2018.
My thanks go to everyone that attended and spoke at the Summit on Tuesday and a special thanks to our sponsors AutoTrader, DHL, NTT Data, Pinsent Masons and Shoosmiths – without them such an event would not be possible. Our next major occasion is the 108th SMMT Annual Dinner on Tuesday 25 November in London. One of the key events in the automotive calendar, due to be attended by some 1,000 guests from industry, government and the media, early bird tickets are still available if booked before the end of today. Click here for more information.