Government must act now to protect UK automotive supply chain jobs and investment

Stephen Morley, President of the Confederation of British Metalforming, reacts to the JLR redundancy news and why companies in the supply chain must come into the ‘support’ conversation.

His organisation represents the interests of 200 members and 75,000 employees involved in the production of fasteners, forgings, sheet metalwork and cold rolled products.

“News of 4000 redundancies by JLR brings into focus the immediate competitive crisis facing the UK automotive industry, a crisis that threatens jobs, investment and our domestic manufacturing capacity.

The announcement by the car giant was not unexpected but importantly has brought into focus the dangerous cocktail of extortionate energy prices, increased regulatory burden and the consequences derived from foreign vehicles being freely imported to the UK.

We welcome the support already announced by the West Midlands Combined Authority for workers facing the threat of redundancies – prompt action is always appreciated.

However, we also want to raise the potential impact this could have on the supply chain, many of whom are members of the Confederation of British Metalforming (CBM)

There are conversations taking place all the time with management teams about volumes not returning to the levels seen before the Cybersecurity attack and the growing uncertainty caused by a misjudged ZEV mandate, which requires vehicle manufacturers to sell an increasing annual percentage of fully electric cars and vans every year.

The CBM is today calling on equal support for the downstream supply chain to ringfence the skills and capability these companies bring to UK manufacturing and the ongoing push for greater sovereign capability.

We also want Andy Burnham and his ministers to urgently accelerate the ZEV mandate review, ensuring it does not become another exercise in delay.

Without urgent action on energy costs (the UK is 100% and 60% higher than the US and Germany respectively), business rates, labour costs, regulation and the treatment of imported electric vehicles, companies will have fewer incentives to invest in Britain and more reason to shift production and future investment overseas.

The government is therefore asking British manufacturers to invest in the transition to zero-emission vehicles while leaving them exposed to higher operating costs and increasingly intense competition from overseas producers.

Unless ministers act across the full range of pressures facing the sector, the consequences will be felt through reduced investment, lost manufacturing capacity, supply-chain closures and fewer skilled jobs across the UK.

Labour must now use the consultation to reform the ZEV Mandate and deliver a broader package of measures to restore the sector’s competitiveness.

It should also act on the urgent need for a joined-up industrial strategy that looks at energy, taxation, business rates, labour costs, regulation, trade policy, the ZEV Mandate and the competitive threat from state-supported overseas manufacturers as one connected issue.

The automotive sector needs government to be awake at the wheel, before more manufacturing capacity, investment and jobs leave the UK.”