UK car manufacturing sector gets glowing report
The Society of Motor Manufacturers and Traders (SMMT) has published a report, compiled by KPMG, saying the UK has become a key location for global vehicle manufacturers which has created big supply chain opportunities.
“With unprecedented levels of investment committed to UK automotive in recent years, the future for our industry is bright,” said Paul Everitt, SMMT chief executive.
“Domestic suppliers have the potential to benefit significantly from increasing output volumes, but they need the right mix of government support and private investment,” said Everitt.
The report points to the UK’s varied mix of vehicle manufacturers which exporting to more than 150 countries around the world, which is a positive factor in the industry’s stability.
“With robust global markets and a diverse mix of models produced here, we are more resilient than other countries to eurozone weakness, a key factor in encouraging businesses to invest in the UK,” said Everitt.
Business Minister Michael Fallon said, “We have some of the most productive plants in Europe, a highly skilled and flexible workforce and one of the lowest corporation tax rates in Europe.”
Vehicle manufacturers have invested £6bn in UK projects over the last two years.
Despite the strong body of evidence that demonstrates how the UK is one of Europe’s most attractive automotive industry locations, there are factors that pose a risk to ongoing success. To develop and keep pace with change, urgent action is required to address an impending skills shortage in key industry areas.
As technology advances, low carbon development grows in importance and vehicles integrate communication, safety and entertainment software, skilled engineers become increasingly sought after.
The other key area of concern identified in the report centres on the need to reinvigorate the lower tiers of the domestic supply chain.
While 80% of parts required for automotive manufacture can be sourced in the UK, the capacity and ability of these suppliers to meet demand is not at the required levels.