Automotive Industry

Ian Lavery Excerpts

Wednesday 12th July 2023 Commons Chamber

[Ian Lavery (Wansbeck) (Lab)]

It should come as no surprise to anyone that since the Conservative Government took power in 2010, the country’s automotive industry has been failed by a lack of investment or any long-term strategy. Since 2010, as set out by other speakers in the debate, we have experienced a 37% decline in British motor manufacturing. That is not insignificant and it is set to continue.

I am lucky enough to be a member of the Business and Trade Committee. A couple of months ago, I asked experts, on a panel discussing the UK’s industrial strategy, how the UK is placed to take advantage of the electric car industry, and about the levels of investment on offer to support companies settling in the UK and creating jobs here, compared with those in the US and across Europe. Put simply, their response was startling but it was absolutely correct. The response from each industry expert was that right now there is no comparison between what is on offer with the Inflation Reduction Act in the US and what is on offer in Europe. That is unfortunate, but that is the reality of where we are at this moment in time.

Looking at the statistics regarding this extremely important debate, the Conservatives have presided over a 37% decline in British motor manufacturing since 2010. There are 780,000 people employed across the UK automotive sector, with 182,000 of those directly employed in manufacturing. Annual UK car production fell by 9.8% in 2022, from 859,000 units to 775,014 units. The UK lags behind the rest of the world in terms of global automotive manufacturing relative to GDP, ranking sixth in Europe and 17th in the world in 2022. Eight in every 10 cars produced in the UK are exported, yet exports of cars manufactured in the UK fell by 14% in 2022. The EU is by far the largest export market for UK-produced vehicles—57.6% of vehicles produced in the UK are exported to the EU.

It is now three years since a gigafactory in my constituency of Wansbeck was proposed, and we have been hoping for the development of Britishvolt at Cambois. In the run-up to Christmas, at a time when people are wondering if they are going to get additional socks, Old Spice, Blue Stratos or new boxer shorts, I got a great surprise, finally. In December 2020, I got a call from a businessman who informed me that he was to develop a big company called Britishvolt, only two miles from where I live. It was as if all my Christmases had come at once: 8,000 much-needed jobs in an area like Wansbeck and like south-east Northumberland, covering different skills. They were secure, unionised jobs that were set out in the telephone conversation I had in December 2020, just prior to Christmas. We were going to get a big gigafactory. It was heralded at the time by Ministers as a perfect example of levelling up. It was heralded by the then Prime Minister as a project that would boost the production of electric vehicles in the UK, while levelling up opportunity and bringing thousands of highly skilled jobs to communities in our industrial heartlands. However, Ministers were not so keen to be attached to it when Britishvolt went into liquidation after failing to get the funds that it needed to continue. That included the money that the disgraced former Prime Minister told me from that Dispatch Box was “in the post”. I asked him at PMQs when BritishVolt would be receiving the £100 million from the automotive transformation fund. He rose, clenching his fists anxiously, and said that the cheque was in the post. I support the CWU and I support the strikes at the Royal Mail, but I am afraid that that cheque never arrived. I do not blame the strikes for that, although others may wish to do so.

That money never ever arrived for Britishvolt. I listened to a Member earlier who said that, had that money been paid to a community such as mine, it would have been frittered away. Let me tell Members: people in my community deserve as much investment in jobs than anywhere else in this country—whether it be a constituency led by the Conservatives or by the Labour party. My constituency deserves to be cared for the same as anybody else. If £100 million is being invested in one constituency, it is seen as fantastic; it should not be seen as being frittered away in a constituency such as mine. It is an insult to everyone in the south-east of Northumberland, and obviously to my patch.

The current situation, as the Minister knows, is that the Britishvolt project was bought by an Australian company, Recharge Industries, and it has given us a glimmer of hope. I asked the Minister a few weeks ago in Question Time whether we could meet up to discuss what support the Government could give to Recharge Industries. She agreed to meet, but we have not yet had the opportunity to do so, so I gently nudge her and say that I would welcome that discussion, because we need that gigafactory. Every industry expert says that we have the best site in Europe for a gigafactory. The only way that it will happen is if we get the support that we need from the Government. So far, it does not look as if that will happen. As I have said before, it would create 8,000 jobs: 6,000 jobs in the supply chain and 2,000 at the factory.

[Matt Western]

I thank my hon. Friend for giving way and ask him to excuse me for having to leave the Chamber temporarily. The point he is making is important. I was in his area earlier this year and saw for myself the new National Grid facility. With its interconnectors and the 3% of UK electricity potential coming ashore from Norway, it is, I agree, the perfect site for a gigafactory—alongside Coventry, of course.

[Ian Lavery]

I will not get into the football analogies that have been drawn on today. I am pleased that my hon. Friend has visited my constituency and seen for himself the potential that Energy Central has in Northumberland. Whether it is the two interconnectors or the Catapult facility in Blyth for renewable energy, we have a lot going on in the Blyth estuary region and, of course, in Wansbeck.

We need to give people some hope. We need to give my constituents the same sort of hope that everybody else is getting. I have sat patiently listening to Members who have lots of jobs in their constituencies. They are very happy with those jobs and the fact that things could not be any brighter. The hon. Member for Bosworth (Dr Evans) said, “Come and have a look at Bosworth. It is fantastic.” I say to him, “Come and have a look at Wansbeck and see how that stands as compared with Bosworth.” I am delighted for the people of Bosworth, but he should be coming to my constituency to see the difference. It is just not fair.

[Dr Evans]

When it comes to the automotive industry, we should be talking about the whole of the UK. The hon. Gentleman speaks passionately about the site of the gigafactory. I know it well, because Britishvolt spoke to me about the site and what it has to deliver. I am more than happy to support him and his constituents, because this is about what the UK can offer to the rest of the world. The automotive industry here is a leader in doing that, so I will champion that, because it happens to be in my constituency. I would love to see it thrive in the hon. Gentleman’s constituency, too, so that we have jobs and prosperity across the UK.

--- Later in debate ---

[Ian Lavery]

I thank the hon. Gentleman, but he should come and have a look. He can drive his electric vehicle up the road and call in to see the obvious difference between my constituency and his.

[Sarah Owen]

This is indeed a UK-wide issue in that if one of us succeeds in the sector, then we all succeed. However, we are talking about not just the jobs of the future that need to be created and maintained, but, unfortunately, the jobs now that need to be saved. There are just not the equivalent jobs for people to go to. Is this not a serious problem for the sector? It is not just about future jobs, but about saving the jobs now.

[Ian Lavery]

That is an excellent point. The reality is that we have lost 37% of production in 13 years. If there is not a halt to that and if there is not the investment that is required to maintain and then increase employment, we will see a total loss of the automotive industry in this country. It is as simple as that. Members have mentioned the different new rules coming into place, the state of origin rules and issues such as that. It is getting more and more difficult to maintain and increase what we have, on top of a 37% decline. The reality is that we do not have anything in place to make that transformation from where we are now to where we need to be. We need to have, I think, nine new gigafactories. We have one. In fact, it is half a gigafactory. That is just not good enough. We keep being told by the Conservatives that they are on the case, that the development is coming, and that they will be developing it—whether it be in Coventry, in the midlands or wherever; hopefully, the next one will be in my constituency—but it is not right to continue saying that we are on track. We are not on track. There needs to be some investment. We need the readies. We will not get people rolling up to different areas saying that they will build a gigafactory unless they have support from the Government.

We should look at the support that other countries have given to their businesses in grants and loans: CATL in Germany received a loan of €750 million, 22.8% of the total build cost; Northvolt in Sweden got €505 million, 17.1% of the build cost; GM in North America got $2.5 billion; Stellantis $1 billion; Tesla $1.3 billion; and Ford $884 million. Britishvolt, which had so much promise, were promised £100 million, 2.3% of the build cost. That was heavily caveated to the point where the company never had a penny of Government support.

We should take a look at the stats. What Labour is suggesting would provide a fantastic opportunity. It needs to be grasped. Regions up and down the country will benefit greatly as a result of what has already been described as turbocharging electric vehicle manufacturing. There could be £30 billion-worth of investment in the regions. We cannot turn that down, but we have to get on with it, which is why I hope that once the election comes and we get elected as the next Government this can be introduced without delay. It will make a huge difference to areas such as the north-east, which will have 13,000 jobs in vehicle manufacturing. Its share of the £30 billion in economic benefits from the Labour plans will be £2.45 billion. Areas such as the west midlands will have 57,000 such jobs, and it will receive £10.76 billion in its share of the investment. The list goes on. The north-west will have 22,000 jobs in vehicle manufacturing and £4.13 billion-worth of investment.

That Labour party turbocharging of electric vehicles is so important and so exciting, but my constituency has been absolutely battered. It has been bruised by the deindustrialisation programme of past Conservative Governments. The lack of an industrial strategy from the Government is still holding my area back significantly. Levelling up means an active state willing actively to protect and invest in the interests of people in held-back areas such as my constituency of Wansbeck. The area where the site would have been developed lies in Cambois, a coastal area in the parish of East Bedlington. Bedlington and Wansbeck—not in Blyth. Britishvolt was never in Blyth. A number of people have mentioned that today, and I have already mentioned it to the Minister a few times. Britishvolt was not in Blyth; that is a Conservative seat next door. Britishvolt is in Wansbeck—my patch. I thought that I would make that point once again, because it appears that very few people listen to what has been said.

We have a proud history in the industrial revolution. It is a coal area. My patch was coal town. We were built on coal. We were part of the great industrial revolution, not only extracting the coal that powered it, but being the birthplace of wrought iron rails in the Bedlington Ironworks, which triggered the railway age. Why should that industrial heritage not be continued at the site of what could be the heart of the green industrial revolution—the transport industrial revolution—simply because once again the Government have failed to deliver for the people of Wansbeck and south-east Northumberland? We need to do a lot better for my constituents.