Tata Steelworks: Newport

Jo Stevens Excerpts

Tuesday 8th October 2019 Westminster Hall

[Jessica Morden]

My hon. Friend is absolutely right. The Government have said the electric vehicle industry is important to them, and they say it is a priority. In his first speech to the Commons after moving into No. 10, the Prime Minister spoke about his vision for the UK as the “home of electric vehicles,” something he also touched on regularly during his leadership campaign. In a recent response to a question I asked, the Prime Minister also stated his commitment to use UK steel in the supply chain for electric vehicles, but we need electrical steel to create an end-to-end supply chain for those vehicles. If the Prime Minister is serious about the UK being the home of electric vehicles, we must, as Community’s Roy Rickhuss has said, consider the Orb a national asset and step in to protect it.

[Jo Stevens (Cardiff Central) (Lab)]

My hon. Friend is making a really powerful speech. What she said about looking at history and the future is so important, and the dedicated workforce and plant have been so successful because they have encouraged innovation over the years. They have been strategic and looked forward. That is what the Government now need to help the plant do with electrical steel.

[Jessica Morden]

My hon. Friend is exactly right, and we need that investment to do it.

Attention has been given to electric car battery production —the Prime Minister mentioned the gigafactories needed to produce high volumes of battery products in his conference speech—but electric motors are an equally important part of the supply chain. They are built from the high-quality, non-oriented electrical steels that could be produced at Orb, and the demand for this type of steel is expected to increase tenfold by 2030.

The number of electric cars on our roads will grow and grow over the next decade. The UK Government are providing millions of pounds to support the roll-out of charging infrastructure, and it is imperative that we use UK steel in all this. The Government have awarded Jaguar Land Rover, which is owned by Tata, a £500 million loan guarantee to help the company sell electric vehicles. In this context, with the Government’s stated support for the electric vehicle industry, I ask what the Government can do for all. Electric cars need electric motors. Why should we have to import them? We have a site here in the UK that, with support, could be part of the supply chain.

We need UK steel every step of the way, and electrical steel is part of that. As members of the all-party group and the unions have long said, the industry can be a key part of building the infrastructure we need to green our economy in the future.

At Labour’s conference, we pledged to accelerate the electric vehicle revolution with 2.5 million interest-free loans for the purchase of electric vehicles, a new requirement for the Government car fleet to be 100% electric by 2025, and action on a private fleet. Labour is determined to ensure that the right conditions are in place for this revolution, and the Government should be, too. If the Orb works is not kept open, the potential to build a supply chain will be squandered. It is not an overstatement to say that the UK could lose its capacity to be a global leader in electric car manufacturing.

Developing a supply chain for electric vehicles will be hugely important for the national balance of trade. Across the UK, 10,000 workers are making internal combustion engines, and Community has emphasised that a failure to develop the supply chain will result in a loss in the export value of those engines. It will be replaced by the import cost of electric motors, which equates to £1.2 billion for every 1 million electric cars. That is why Community has called Orb a

“strategically important business underpinning this vital industry of the future.”

Tata has publicly confirmed that, with investment, the Orb works can produce the steels required for the future production of electric vehicles. Community’s steel consultant, Syndex, has researched and concluded that with a new strategy and some public support, there could be a sustainable future for the business. So what is the plan? The new strategy for Orb would mean transitioning to a new model and producing non-oriented steels, in addition to grain-oriented steels, based on a new Wales-only supply chain and using coil from Port Talbot. To fund the necessary capex, the profits from the sale of Cogent Power Inc—another part of the business, which is wholly owned by the Orb—would be reinvested into the business, along with the money set aside to finance a closure.