UK Automotive Industry

Luke Evans Excerpts

Monday 18th September 2023 Commons Chamber

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

It is a pleasure to follow the right hon. Member for Wokingham (John Redwood), who made a very interesting speech. He asked many of the right questions, and he even came up with one or two right answers. I disagree with many of his conclusions, but it was interesting none the less.

The right hon. Gentleman talks about the electricity that will charge these batteries at home, in terms of renewables versus gas, etc. Obviously, in Scotland we will have a massive excess of renewable electricity in the coming years to power our electric vehicles, and we have a couple of large hydrogen schemes ready to go that will be powered by excess renewable electricity. This will add additional baseload to the grid in Scotland.

I did agree, however, with what the right hon. Gentleman said about a stick approach to consumers, as I do not want to see the Government produce a large stick. I made the point in an intervention that they have withdrawn many of the incentives to switch to electric vehicles. I prefer a much more balanced approach, where there is a carrot and a stick, particularly given that the price of EVs is still higher relatively than internal combustion engine cars. We want the switchover to electric cars and to our decarbonised future to be open to everyone, not just to people such as us in this Chamber, who can potentially afford it—I speak as an EV owner.

The Minister, like the Secretary of State today at the Society of Motor Manufacturers and Traders electrified event, which has been mentioned, was extremely bullish about the UK automotive industry, and recent announcements on the investments highlighted by the Minister and the Secretary of State earlier today are warmly welcomed. But right now they are a fig leaf to cover deeper issues—ones largely not caused by the sector itself. The UK automotive sector has a great many strings to its bow, but the challenges it faces are real and immediate. They include: the spectre of Brexit; slow and unresponsive UK Government policy, including the complete lack of an overall industry strategy, let alone a strategy for the sector; and an ongoing culture war within the Conservative party about the net zero agenda.

Of course, there is also the concerning pace of the Department for Transport’s EV charging infrastructure roll-out to consider, which highlights the contrast between Scotland’s rapid EV charging network and the shortcomings in England, particularly outside London. The disastrous decision to leave the European Union—one that was made for Scotland—has had profound consequences for many sectors, and the automotive industry is no exception. The intricate supply chains, just-in-time manufacturing processes and integrated regulatory frameworks that once underpinned our automotive sector have been disrupted, causing uncertainty and economic turbulence. Brexit has led to increased costs for manufacturers, who now face customs checks, tariffs, and regulatory divergence when exporting to our European neighbours. That has forced many manufacturers to reconsider their operations in the UK, leading to job losses and a loss of investment.

[Dr Luke Evans (Bosworth) (Con)]

It is dangerous to have this doom-mongering. Triumph Motorcycles in my constituency, for example, has seen its exports across the world, in emerging markets such as Asia and America, go from 40,000 to 70,000 in the past three years. Is that not exactly what we want to see from a bold UK, one that is looking outwards and expanding across the world? Triumph, right in my constituency, is a prime example of it.

[Gavin Newlands]

I am grateful for the intervention and, obviously, that is a triumph for Triumph, but it is very much the exception that proves the rule, as I am about to go on to state. I congratulate Triumph on its export success, but Brexit has caused immense damage to our automotive sector, with real-world consequences for workers and communities. Since Brexit, car production in the UK has plummeted from about 1.7 million in 2017 to just 840,000 in the 12 months leading up to July this year. Factories produced just 775,014 cars during 2022, the lowest figure since 1956.

Despite the much more positive recent news on investment, which has been mentioned, the new post-Brexit rules of origin that come into effect in January, which place tariffs of 10% on exports of electric cars between the UK and the EU if at least 45% of their value does not originate in the UK or EU, will be deeply damaging. The Minister mentioned Stellantis, the world’s fourth largest car manufacturer, which has recently warned that a commitment to make EVs in Britain is in jeopardy unless the Government renegotiate their Brexit deal with the EU to maintain existing trade rules until 2027. Mike Hawes, the chief executive of SMMT, speaking at the very same conference as the Secretary of State, echoed similar sentiments. Of course, the dogs on the street know that Brexit has been a disaster and they also now know that Labour owns this Brexit every bit as much as the Tory party. There is no mitigating, fixing or polishing Brexit, and the sad thing is that the Leader of the Opposition and the vast majority of those behind him also know that to be true.

To compound that issue, the UK Government’s approach to supporting both the industry and consumers during this period of upheaval has been less than ideal. We have witnessed unresponsive Government policy that lacks a comprehensive strategy for the sector’s future. The industry, a cornerstone of our economy, deserves a clear vision and targeted support to ensure its competitiveness and sustainability in a rapidly evolving global landscape. The ZEV—zero emission vehicle—mandate is a case in point, because on paper it is a good thing and it has cross-party support, save from some Conservative Members, but it has been bungled from start to finish. I say “finish”, but we still do not know the final details of the policy, and how it will be enacted or enforced, even though it is scheduled to kick in next year. Mike Hawes said this morning that

“until we see the regulations, we can’t plan, and if we cannot plan, we cannot deliver.”

Furthermore, the culture war within the Conservative party about the net zero agenda is sowing seeds of confusion and inaction. This morning, Mike Hawes had a message for the Conservatives, dressed up in a rhetorical reference they might understand:

“With respect, and I choose my words carefully—very carefully—where there is uncertainty may the Government bring certainty because on decarbonisation this industry is not for turning.”

We should all be united, not so much in quoting Margaret Thatcher—many in this Chamber might like me to do so, but it will not win me any votes—but in our efforts to combat climate change and achieve net zero emissions. We are instead witnessing political infighting that threatens to derail our progress. It is time for the Conservative party to put aside its internal divisions and focus on the pressing issue of climate change. One crucial aspect of that transition is the promotion of EVs.

The Scottish Government have taken decisive steps to support green transport, and we will continue to support the automotive industry to phase out the need for petrol and diesel cars by 2030. The most obvious example of this is on the charging infrastructure, particularly the rapid charging infrastructure, which I will come back to, but Scotland has also shone on incentives to drive switching from combustion engines to EVs. Over the past 10 years, Scottish Government grant funding has provided more than £165 million of interest-free loans to support the purchase of more than 6,100 vehicles, including my own—I have already declared that. If we look at that from a UK Government spending perspective, we see that that is the equivalent of £1.6 billion for 61,000 vehicles. The Scottish Government have provided nearly £5 million to support the installation of more than 16,000 home charge points across Scotland, which is the equivalent of nearly £50 million for 160,000 home chargers—that is over and above the Office for Zero Emission Vehicles grant funding from the UK Government. The Scottish Government have also provided the equivalent of more than £100 million to deliver 15,000 charge points to businesses.