New industrial strategy brings sunny outlook for UK automotive

Three months ago, Society of Motor Manufacturers and Traders boss Mike Hawes said it “felt like you were being punched on all sides”. But the government’s new UK Modern Industrial Strategy is one of a number of developments that makes Hawes “a bit more optimistic” about the future. An automotive-specific trade deal with the Trump administration – the only one signed and in force of its kind in the world – is another reason for hope. People have even stopped asking him about Brexit… Hawes credits this government, and in particular business secretary Jonathan Reynolds, for giving meaningful support to the industry. To that end, it is “encouraging” that there are references to the automotive industry “liberally sprinkled” throughout the strategy, which was announced at Horiba MIRA the day before Hawes’s SMMT Summit, in a further sign of automotive’s importance. The government’s strategy is both to attract inward investment and ensure cross-government support, making sure decisions are made with automotive in mind. Its 10-year length also makes for a more stable environment for investment. It confronts the UK’s high energy costs, although crossgovernment support for UK competitiveness will no doubt be tested at some point to ensure savings here aren’t undermined by making other areas more expensive, such as with labour costs going up due to recent national insurance hikes on employers. In reference to the fading Brexit turmoil, Hawes said: “Despite everything going on globally, the UK is seen as being more stable than over the past decade.” One of the strategy’s goals for UK car production is to get to 1.3 million units by 2035, almost 50% up on today. Hawes said that to do so will require “new entrants”, most likely from China. A manufacturer looking to invest in the UK now has more reason to do so than before the strategy’s publication. The UK’s diplomatic efforts with China, Europe and the US have led to better relationships across the board, keeping tariffs low and ensuring the UK can be a global export hub. The India trade deal could present opportunities, too. Hawes is well aware that attracting new investment is “fiercely competitive”, while our domestic market’s switch to EVs is lagging. He said substantive incentives that “make a difference to consumer sentiment and build the momentum you need” are required. Yet the past few months have reassured Hawes there is a keen interest in cars, their technology and manufacturing. “The government, or the mainstream media, wouldn’t give it that much attention if it didn’t matter both politically and to individuals,” he said. “It has a tremendous amount of relevance and importance to people.”

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New industrial strategy brings sunny outlook for UK automotive

Strategy targets annual production of 1.3 million by 2035, almost 50% up compared with today's levels

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New industrial strategy brings sunny outlook for UK automotive

Strategy targets annual production of 1.3 million by 2035, almost 50% up compared with today's levels

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