Automotive Industry

Debate between Barry Sheerman and Rachel Hopkins

Wednesday 12th July 2023 Commons Chamber

[Rachel Hopkins (Luton South) (Lab)]

It is an absolute pleasure to follow my hon. Friend the Member for Luton North (Sarah Owen), a good friend who spoke so passionately about the length of time Luton has been associated with Vauxhall Motors—I appreciate the Minister nodding at that. As we have heard, the automotive industry is critical to the UK’s economy; it is a jewel in the crown of British manufacturing. I agree with the comments made by our Front Benchers about the importance of maintaining a good manufacturing sector in our country and the associated good, skilled jobs.

In Luton, we are proud of our automotive heritage. For once, let me carry on a football analogy by saying that we are also proud of our premier league football team. Generations of families have worked at the Vauxhall plant, making many well-known family cars and, more recently, medium-sized vans, based on the Vauxhall Vivaro. I have seen the heritage displayed in all sorts of ways. When I visited Someries Junior School recently, it had the full history of Vauxhall set out in a montage, where the cars had been drawn on and the history from 1905 was talked about. Similarly, when I have been out talking to the people of Mid Bedfordshire, I knocked on the door of someone who works at Vauxhall and is the daughter of one of the Unite representatives.

I was pleased to meet the Minister recently to talk about the importance of the automotive sector to Luton and the need for a long-term strategy to safeguard the industry and good jobs in our town. Having joined this place in 2019, I first raised the issue of the need for a strategy specifically to support the automotive industry some three years ago, in July 2020. The Minister has seen me raise many an automotive issue. If the hon. Member for Bosworth (Dr Evans) was here, I could assure him of how many times I have raised the issues of semiconductors, electric vehicle batteries, gigafactories, the supply chain, rules of origin and charging infrastructure. There is a genuine interest here about the importance of all of it to our economy.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

I am hesitant to interrupt, because I know of my hon. Friend’s expertise in this area. However, may I ask her: are the Government giving enough help for the future of our industry? Many believe that hydrogen power is coming fast, and that its impact might be similar to what the invention of the railways meant for the canals. Are the Government giving enough hope and resources to the industry to look forward to hydrogen power as well as battery power?

[Rachel Hopkins]

I thank my hon. Friend for that intervention. Obviously, the Opposition are hosting this debate to get support for the automotive sector, and his question about whether the Government are giving sufficient support to hydrogen is perhaps one for them. I want to make sure that I have my points on the record about the future of electric vehicles at the Vauxhall plant.

Three years on, I am still calling for that long-term plan from the Government. Despite the Minister reciting many a meeting, visit and champion of X, Y and Z, where is the plan that we can all look up to and see how it is going to support our sector? We have seen this Conservative Government preside over a 37% fall in British motor manufacturing since they came into office in 2010. Indeed, eight out of 10 cars produced in the UK are exported, yet exports of cars manufactured in the UK fell by 14% in 2022. Government inaction, which we are debating today, threatens the future of the automotive industry and of Vauxhall in Luton, particularly the future of its electric vehicles.

The UK is heavily reliant on battery technology from Asia. While the UK currently falls under the threshold of rules of origin quotas, the ratcheting up from the beginning of next year poses a risk to the UK automotive industry. As we have heard, Stellantis, the owner of Vauxhall, told the Business and Trade Committee inquiry into the supply of batteries for EV manufacturing in the UK:

“There will not be sufficient battery production supplies in the UK or in Europe by 2025 and 2030”

to meet the rules of origin requirements.

Rather than working with the EU to suspend a ratcheting up in rules of origin requirements until 2027, I am concerned that we will see too little, too late from the Government, and the Conservatives will oversee the imposition of 10% tariffs from 1 January next year. Just for nuance, those tariffs are 10% to 22% for electric vans, which particularly impacts the Vauxhall plant in Luton South.

Overall, these tariffs would hinder the UK’s struggling automotive sector, pass on yet more cost to British people, already struggling with a cost of living crisis made in Downing Street, and would make the green transition unnecessarily unaffordable for millions across the country.

Until we have sufficient domestic battery production, our industry will be at a major competitive disadvantage, in particular against Asian imports, specifically from South Korea, Japan and China. The reality is that if the cost of EV manufacturing in the UK becomes uncompetitive and unsustainable, the future of domestic operations will be at risk. Decisions will be made by producers to move production elsewhere, if there is no confidence in the UK Government’s desire to facilitate a sustainable automotive and electric vehicle market, a point well made by my hon. Friend the Member for Llanelli (Dame Nia Griffith), particularly as British businesses are also facing the highest energy costs in Europe.

It is also important that the Government recognise the innovation and technological advancements posed by the wider industry. Since joining the all-party motor group, I have learned a lot about how motorsport in the UK—the best in the world, with the greatest engineering and tech teams—influences the ordinary automotive sector. For many years, we have seen a cycle where cutting-edge motorsport develops innovative automotive solutions and efficiencies that the automotive sector later adopts for the wider market.

We have heard about steps being taken on sustainable fuels, but much more has been linked to the huge strides in technology relating to software. It is right to remember how the motorsport industry pivoted brilliantly during the pandemic to support the ventilator challenge. I raise this because if the Government sit back and allow the demise of our automotive industry, we will risk losing the world-class engineers, tech experts and motorsport companies, as they will look elsewhere for an environment that is more conducive to the sport. That would be detrimental, not only to the entertainment side of motorsport, but as a significant contributor to our economy and society.

As we have heard, Labour has an excellent plan to turbocharge electric vehicle manufacturing. In government, we will prioritise an agreement with the European Union to ensure that manufacturers have time to prepare to meet rules of origin requirements. We are committed to rapidly scaling up UK battery making capacity, by part-financing eight additional gigafactories, creating 80,000 jobs, powering 2 million electric vehicles and adding £30 billion to the UK economy.

Labour will accelerate the roll-out of charging points and give confidence to motorists to make the switch, with binding targets for electric vehicle chargers. Our plan includes measures to make the UK a clean energy superpower by 2030, with net zero carbon electricity, lowering electricity costs for the UK car industry. I look forward to supporting Labour’s business team to make this a reality, so that the young people in Luton South see a positive future ahead of them, with good, skilled jobs for the long term.