By Mike Torpey on 2022-06-28 - Driving Force news editor and responsible for organising our daily output. He was staff motoring editor of the Liverpool Echo for 20 years.
Car makers call for
action on energy
BRITISH car makers are calling for urgent action on spiralling costs as new analysis from the Society of Motor Manufacturers and Traders reveals firms face a £90 million uplift in energy bills this year.
That's the equivalent to more than 2,500 automotive jobs - as costs surge by 50 per cent.
UK electricity prices are the most expensive of any European automotive manufacturing country and 59 per cent higher than the EU average.
And that, says the SMMT, means that last year UK manufacturers could have saved almost £50 million on energy costs if they were buying in the EU rather than the UK.
The additional cost of producing vehicles and components in the UK is putting manufacturers at a competitive disadvantage, stalling momentum when the sector needs to make massive investments to meet accelerated timescales for the transformation to zero emissions.
The news comes as the SMMT sets out a fresh roadmap,‘From Full Throttle to Full Charge',with a clear vision of the sector leading the push to net zero.
The timeframe to act is narrowing, however, with 2024 a looming milestone when EU-UK Rules of Origin get tougher and the Government's Zero Emission Vehicle Mandate kicks in.
With the UK implementing one of the most ambitious road transport decarbonisation timelines in the world, phasing out the sale of new petrol and diesel cars and vans by 2030, the urgency of action required is self-evident.
The SMMT's report reveals the scope and scale of a broadened UK automotive supply chain, including the contribution of industries which supply into automotive such as steel, plastics and paint.
At stake in the transition are the 123,500 jobs supported in every region of the UK, across some 5,000 firms, which turnover a collective £21.2 billion every year, export products worth £7 billion and deliver £5.7 billion direct to the economy.
SMMT chief Mike Hawes said: "From Covid impacts to component shortages, supply chain disruption to trade uncertainty, and regulatory change to rising inflation, the challenges facing this sector are immense. Nevertheless, addressing the UK's high energy costs is the industry's number one ask.
"Help with energy costs now will help keep us competitive and be a windfall for the sector, stimulating investment in innovation, R&D, training - all reinvested in the UK economy. With the right backing this sector can drive the transition to net zero, supporting jobs and growth across the UK and exports across the globe.
"Our plan, From Full Throttle to Full Charge, sets out how industry can work with government to build a UK automotive ecosystem fit for a zero emission future. If there is the will, the effort and the action from government, they will find it matched by that of the UK industry in investment and competitiveness."
‘From Full Throttle to Full Charge' highlights the critical role automotive plays in every region of the UK, delivering well paid, highly skilled jobs, supporting communities and driving the wider economy.
More than a quarter (28.2 per cent) of the automotive supply chain is based in the West Midlands alone, with 13.3 per cent in Yorkshire and Humber and 11.8 per cent in the North West.
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