SMMT News UK Manufacturing

SMMT looks forward to pre-budget report

13 November 2008 #SMMT News #UK Manufacturing

American politics has taken on a new significance in the UK as president Bush and president elect Obama’s debate on a possible support package for the big three US automakers – Ford, General Motors and Chrysler – is likely to have a major impact on UK production. Both Ford and GM have manufacturing plants in the UK producing cars, vans and engines.

In the UK, the motor industry continues to call on government for national support looking forward to the pre-Budget report on 24 November as an opportunity for government to send a clear signal to UK motorists.

SMMT is urging government to use the pre-budget report to scrap the planned increase in vehicle excise duty (VED) and the First Year Rate from 2010/11 which would significantly increase the cost of motoring for around 1.2 million motorists.

“Now is not the time to be increasing motoring taxes”, said SMMT chief executive, Paul Everitt. “The industry is facing the toughest conditions in a generation. Government should be acting to stimulate the market and boost consumer confidence, not increasing the cost of motoring in the current economic climate.”

Scrapping the planned changes to VED is part of a full package SMMT has called for which also looks at financing options for vehicle manufacturers and prospective vehicle buyers. SMMT is calling for manufacturers’ finance companies to gain access to the funding available to banks through the special liquidity arrangements, allowing them to support customers and their franchise networks.

Looking beyond cars, SMMT would like to see an increase in capital allowances for fleet buyers to stimulate immediate demand in the commercial vehicle market and a prompt allocation of existing funding to support training and research and development projects throughout the supply chain.

“There are over 800,000 jobs dependent on the motor industry in the UK, ranging from design and development to manufacturing and retail throughout the supply chain. Falling registrations in the car and commercial vehicle segments will have a rippling effect throughout the industry”, concluded Mr Everitt.

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