Automotive growth is a cross-party priority
Party conference season came to a close this week and SMMT returned to base following a tour that provided constructive opportunities to meet parliamentarians and influencers from across the political spectrum. Interest in our sector naturally comes from a wide range of stakeholders given its critical contribution to the economy, employment, skills, innovation, trade, inward investment and decarbonisation – all integral to the success that every government needs.
Government has recognised this importance, placing automotive at the centre of its long-term Industrial Strategy – and this week it published its first quarterly progress update, including more than 50 cutting-edge auto projects securing £70m in innovation funding. Such commitments will drive greater returns for the UK, but with global competition coming thick and fast, deploying the remainder of the £2.5bn DRIVE35 at pace will be essential if we are to be at the front of the race.
Meanwhile, September’s new car market data published on Monday served as an early test of the new EV grant scheme and, if one takes the headline figures at least, the initial signs are promising – with battery electric vehicles reaching record levels. It’s a milestone that reflects how far the industry has come, and how fast we’re moving. But it is also growth that has come at a cost – with manufacturers investing massively in new products, while also providing discounts at unsustainable levels to drive demand ahead of natural market levels.
The new van market shows a similar picture, with electric volumes rising quickly thanks to more than 40 different zero emission models from which operators can choose. Despite this, uptake remains at little more than half the level mandated. Both the electric car and van grants will help address the barrier of affordability but they are not silver bullets; sustained support through infrastructure investment and clear policy signals are necessary next steps.
Transitioning such complex markets with dozens of brands, hundreds of models and around two million new buyers, requires every possible lever to be pulled. What’s needed now is confidence and collaboration between government and industry to ensure the transition is even more affordable, consumer-friendly and sustainable. Success will give the industry growth, while keeping the nation on the move.