Matt Western
Main Page: Matt Western (Labour - Warwick and Leamington)Department Debates - View all Matt Western's debates with the Cabinet Office
(1 year, 5 months ago)
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Jonathan Reynolds
I think those companies must have seen the opinion polls and are wondering whether a Labour Government are coming, if there is as positive news as that could be. I would simply say to all Conservative Members that, on any aspect of industrial policy, there is too often on their side a desire to pick individual stories or statistics and try to pretend that substantial and significant issues do not exist. If we talk to anybody reasonably objective in this sector, they will point out—on battery production, rules of origin, charging infrastructure, industrial energy prices—that there are real challenges and they require some serious engagement from the other side, which to date has not been forthcoming.
Matt Western (Warwick and Leamington) (Lab)
I would like to add to that comment—my hon. Friend is making an excellent speech, by the way—what was said at the industry conference held by the Society of Motor Manufacturers and Traders a couple of weeks ago. The industry was speaking as one, and I am afraid it was critical of the Government, saying, “All these years on, remember that Baldrick at least had a cunning plan. Sadly, the Government don’t.”
Jonathan Reynolds
I followed that conference very closely—my hon. Friend the shadow Transport Secretary spoke at the conference, and I have spoken at that conference in the past—and that was absolutely the sentiment. Perhaps humility does not come easily to Conservative MPs, but I ask them to take on board those genuine views from the industry on the situation we find ourselves in.
The automotive sector could be a practical illustration of the transition to new jobs and new opportunities that we all want to see. We have laid out our plan for the sector. Some Conservative colleagues may disagree, but let us have from them some alternative proposals, because the status quo will not do. Our motion is a plan to deliver £30 billion in economic growth in the parts of the country that need it most. It is a plan that could create 80,000 additional jobs—good jobs of the kind that people can raise their family on. It is a plan for Britain that would mean we once again lead the pack and feel confident for the future. I believe the choice is clear—a plan under Labour or further decline under the Conservatives—and I think we all know whom the public would prefer behind the wheel.
Ms Ghani
This Government have a strong mandate to reach net zero and the consultation has just taken place on said mandate. The right hon. Member will know that I have been spending a lot time with the automotive sector, including taking delegations to meet the Minister of State, Department for Transport, my right hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman), who will be overseeing that. My job—I also chair the Automotive Council—is to champion business, and on occasion to try to remove all the barriers it needs removed for it to manufacture more and export more. I know that the Transport Minister will be speaking more about that later.
I will get on to all points the hon. Member for Stalybridge and Hyde raised, but he mentioned growing up in Sunderland. Just for the record—I can see there is a Birmingham MP here, the hon. Member for Birmingham, Perry Barr (Mr Mahmood)—I grew up in Birmingham very close to a car plant that employs many members of my family, including my brother Nasim, so this sector is very close to my heart. I have been told not to make any football jokes about Birmingham and Sunderland at this point; I will leave that for the final speech.
Matt Western
This point is not about football; it is about the debate. To pick up on the Minister’s analysis, she is correct on the statistics she gave about the UK market. She will know that we started from a pretty poor base post the pandemic and that our production was particularly hit, but other countries recovered better. It is an international market that is fighting for investment—I am sure she will accept that—and that is why it is of concern.
Ms Ghani
It is an international market that is fighting for supply chains. The SMMT was clear that, when manufacturing production was low, that was down to access to products and critical minerals, which I will come on to. As well as taking care of the industry, I am responsible for critical minerals and for supply chains. We are working with the industry, which I met just this morning, to put together a supply chain import strategy, which will be out in the autumn. We need to get a number of things right to make it even easier for the sector to do even better than it already is, but it is in a really good place and I will go on to mention some of the facts and stories about that.
The sector is indeed a jewel in the crown of our economy. It is vital, because of where it is based across the country, to supporting the levelling-up agenda, net zero and advancing global Britain. Our automotive industry employs 166,000 people, adds over £70 billion to the UK economy and is our second largest exporter of goods. The UK is proud to be home to major global manufacturers such as JLR, Nissan, Stellantis, Toyota, BMW and Ford. But that is not the whole of the UK’s automotive eco-system: we have a lot more to be proud of, from our luxury and performance sector, including Rolls-Royce, Bentley, Aston Martin, McLaren and Lotus, to heavy goods vehicles and buses, such as Leyland Trucks, Wrightbus, Alexander Dennis and Switch, as well as the future of mobility, encompassing connected and autonomous vehicles. Those manufacturers are supported by a diverse, resilient and growing UK supply chain that spans a wide range of components and includes companies such as Bosch, NSK, Meritor and Swindon Pressings. These are valued partnerships, and the sector knows that my Department for Business and Trade is the Government’s first port of call to help businesses grow and flourish, and to create jobs, apprenticeships and opportunities around the country.
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.
Matt Western (Warwick and Leamington) (Lab)
It is an honour to follow the excellent speech of my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders). As someone who is passionate about this industry, I would say that there is huge support for talking up the sector on the Opposition side of the Chamber, as we have heard in the contributions of colleagues over the last couple of hours.
When I think of the sector’s contribution to UK plc, I think about the alloy wheels being made in Fort William, the Ferodo brakes being made in Chapel-en-le-Frith and the panels being beaten out in various parts of the country. I think about the likes of the factory just around the corner from where I live that makes the gearbox for the Bugatti Veyron, no less. Up and down this country we have some of the finest companies and the finest engineers making products, contributing to the supply chain and to the original equipment manufacturers that produce vehicles of all sorts, from motorbikes to diggers.
I also pay tribute to a great old friend of mine who we all remember, Jack Dromey, who called this automotive industry the “jewel in the crown” of UK manufacturing. That is something I have always believed, and indeed I spent a great deal of my life working in it.
On the point about the few contributions made about the sector in this place, back in May 2018 I held a parliamentary debate on the subject, and I was disappointed by the number of contributions from certain quarters. Five years ago, I talked about the challenges that the industry faced, and the points I made then are hardly different from some of the points that the Society of Motor Manufacturers and Traders has highlighted in its five-point plan.
The real fear across the industry is that the Government are not acknowledging the importance of the sector, and certainly have not over recent years. Until a few years ago, the right hon. Member for Tunbridge Wells (Greg Clark) had an industrial strategy, which was recognised by the industry, but that has, of course, fallen by the wayside. Indeed, I attended the SMMT international conference a year ago. A collection of industry heads from around the world, as well as UK bosses from right across the sector, were assembled for a full day’s conference. The keynote speech was given by the Prime Minister, who was then Chancellor. Sadly, it lasted a minute and 40 seconds.
I will not put words into the mouths of others, but the reality is that, that day, the industry felt utterly disrespected by this place. The Government are the Government, but the industry thought, “Well, what does Parliament really think about the contribution we are making to the UK economy?” Such a short keynote speech was felt, by Japanese or European colleagues who came over here to listen to the UK Chancellor, to devalue the industry’s work, as well as its investment. Unfortunately, those signals are very badly read in boardrooms across the world because, of course, the UK industry is made up of companies that are headquartered in Japan, Paris, Munich or wherever, and they listen carefully to the messages coming out of this place. That is important.
To give credit where it is due, Margaret Thatcher actually recognised the importance of the UK industry by bailing out British Leyland back in the day, which saved brands such as Jaguar Land Rover and Mini, as well by attracting inward investment from the likes of Honda, Toyota and Nissan. Sadly, we have lost investment from Honda, Ford and others in the past few years. That is why we are at a challenging point for the industry’s future.
We are blessed to have some great companies here, including Jaguar Land Rover, Stellantis, as we have heard, and BMW Mini. Then, of course, we have luxury and performance manufacturers such as Rolls-Royce, Bentley, McLaren, Aston Martin—just down the road from me—and all the other myriad specialist companies, including Lotus, Caterham, Morgan and so on. The sector is even wider if we include the likes of Norton, Triumph—about which we have heard—JCB and Caterpillar, as well the bus and coach manufacturers that have a presence here and in Northern Ireland, such as Wrightbus, which are doing some superb product development and addressing the need to get to net zero.
The sector is so valuable. It can contribute £67 billion in turnover and £14 billion in added value to the UK economy, and it typically invests £3 billion a year in research and development. However, the industry has been so reliant on fossil fuels that the transition to net zero is a critical point in its history. I will outline some of the issues, one of which is the political stability—or the lack of it—to revive and attract the business investment that we need. Of course, I welcome this morning’s announcement by Renault-Geely, but we are really behind the curve. I will also pick up on a few challenges such as the ZEV mandate and the new trading relationship with Europe, including, of course, the rules of origin issue, which is so critical. I will then touch on energy and the other import costs that are a real drag on investment in the UK, as well as the need for an EV and hydrogen infrastructure mandate if we are to get the sector going.
The transition needs a clear industrial strategy; it needs to become a political priority. Sadly, the words “industrial strategy” have not really been part of the Government’s vernacular over the past few years, as we have heard. Make UK said that, under this Government, we have had a decade of “flip-flopping” on industrial strategy. Do they back business or not? Boris Johnson clearly did not, going by his immortal words. Of course, we had the kamikaze Budget of last autumn. That is all damaging to the way in which the global industry perceives the UK. This is not talking down the UK; it is the reality of the messages coming out of this place. Businesses want security and stability before they invest for, say, 30 or 40 years. Think about the Toyota plant at Burnaston, which has just celebrated its 30th year—that is a fantastic achievement. Nissan, of course, is that bit older, but those are really prized assets that we have.
Turning to net zero and the Government’s ambitions with electric vehicles, we need to press on that issue and ramp up battery manufacture. As we have heard, we are way behind compared with other countries, but we also need to support wider adoption of vehicles. The plans we have—offering interest-free loans and potentially trialling a national scrappage scheme—are important. However, as I said, the charging point network for EV is way behind schedule. My hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) made the point that more EV charging points are being installed in Westminster than in the north of the country. That is quite a sobering statistic, and where we do have those few chargers, they are all too often poorly maintained. There needs to be a mandate to ensure that that infrastructure is delivered, not just for EV but for hydrogen hubs. We have made something like a tenth of the investment in hydrogen hubs that Germany has, which of course will be aimed at future heavy goods vehicles and other mass transport systems. Until recently, we had 12 hubs; that number has now fallen to six, I think, so we are going backwards when it comes to hydrogen hubs.
We have talked about battery production, and heard the passionate speech from my hon. Friend the Member for Wansbeck (Ian Lavery). As someone who went to his constituency 40 years ago, I know how important that gigafactory would be for his constituents, and I would love to see that happen. The technologies are moving on rapidly: we can look at the work being done by Warwick Manufacturing Group, which is leading the development of battery technology, or by UKBIC, which is the industrialisation centre just outside Coventry. The UK absolutely could be at the forefront of that work, but we need the investments to make it happen, and as demonstrated by Britishvolt, that has just not been happening. There are some questions about what is happening with Recharge Industries as well.
I touched on hydrogen; Members have also made points about sustainable fuels, and there is something to be said about what could be done in that sector. The motorsport industry is doing a huge amount of work exploring those technologies, and again, we are very much at the forefront of what can be done in that space—how existing internal combustion engines could be used with that kind of fuel to bring them close to net zero. That innovation is so important, whether it be through motorsport or our higher education institutions. We heard about HORIBA MIRA from the hon. Member for Bosworth (Dr Evans) and we have motorsport valley down the M40, but the Advanced Propulsion Centre at Warwick is also doing some fascinating work, supporting new companies with emerging technologies to make them commercially viable.
As the Government will know, there are some real concerns about the ZEV mandate, certainly about the tradeable element and what it will mean if manufacturers miss their targets, as well as what those targets will be after 2030. Then, of course, we have the rules of origin, which—as we have heard from colleagues, particularly “the Stellantis three”—are a real and critical hit to the sector. I am not sure whether I am a Stellantis fourth in disguise.
Matt Western
Maybe in spirit, yes—that is exactly what it is. Those tariffs will be real tariffs, going both ways, but they will particularly impact on battery electric vehicles. That is why Labour would prioritise an agreement with the EU, because we have to deliver a modern border and customs framework that will facilitate smooth and cost-effective trade.
I will make a couple of other points. We need the skills to make this all happen, both in the network of our dealers and in our factories and our manufacturing sector, but we also need clean energy. We have such a cost disadvantage in this country compared with France and a lot of Europe, but particularly when compared with Spain, where energy costs something like a tenth of what it does here. That is why Labour will launch an urgent mission for a fossil fuel-free electricity system by 2030, because we have to reduce the cost to businesses and to EV drivers as well. When we see the work that President Biden is doing through the IRA, we realise just how much can be done with a vision, and that is what I think is frustrating so many want-to-be investors in this country.
In closing, I come back to the speech of my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds), which I thought was a clinical dissection of the challenges facing the sector. This is a really important sector—from e-mobility to motorbikes and diggers—for the value it provides not just in the abstract to UK plc, but as I cited in my opening remarks, to communities and constituencies up and down the country. When I speak to businesses in the sector, which is virtually every week and certainly every fortnight, they impress upon me the desperate need for some clarity because they want to make long-term decisions. These are companies such as JLR, Stellantis, Toyota, Nissan, BMW, Mini and others, and decisions have been made by boards elsewhere around the world. That is why, with colleagues, I will always talk up this industry. It is an industry that I think is so important to our future, and an industry at the point of transition. However, we will be honest about the challenges. We must champion the prospects and what this country can provide to them, because we want the investment, and the industry wants us to provide regulatory, political and economic stability.