Independent research commissioned by the Society of Motor Manufacturers and Traders (SMMT) has revealed encouraging prospects for the UK automotive supply chain with the majority of volume car manufacturers with UK plants showing a strong interest in sourcing more locally-built components.
Covering short, medium and long-term issues, the reasons given centred on:
· A tactical shift to benefit from a favourable exchange rate.
· Minimising the vulnerabilities and logistical costs associated with an extended supply chain.
· The attraction of the UK’s labour flexibility and positive industrial relations.
· Sourcing new technology for ultra-low carbon vehicles.
The report recognised the significant opportunities arising from the transition to a low carbon economy, but also identified some conventional technologies that manufacturers would like to source more of in the UK. This list included:
· Basic automotive components:
o alloy wheels
o alternators and starter motors
o brake components
o castings and forgings
o fasteners, nuts and bolts
o plastic mouldings in general
o large stampings
o sheet steel and aluminium
o transmission components
o wiring harnesses
· Higher technology areas:
o electronic control units (ECUs) in general
o satellite navigation systems
o advanced air conditioning
o safety systems – especially airbags
While suggesting component manufacturers prepare now for the requirements of future model production, alongside batteries, the report highlighted related components that would need to be sourced close to the vehicle or battery assembly plant:
· Specific wiring harnesses.
· Electric drivetrain.
· Gearing system.
· Electrical power control unit.
“There is genuine interest and commitment from global vehicle manufacturers in building a stronger UK-based supply chain,” said SMMT chief executive, Paul Everitt. “The challenge is to convert this interest into firm orders. This will require a more collaborative approach between industry and government, particularly to encourage multinational tier 1 suppliers to increase investment in UK R&D and supply chain management capability. The transition to a low carbon future presents significant opportunities for growth in the automotive sector but immediate action is needed if the UK is to stake its claim and benefit in a global industry.”
The study, undertaken by research group AutoAnalysis in the final quarter of 2009, involved interviews with UK chief executives and senior purchasing managers with UK vehicle and component production sites, seeking to investigate the future prospects of the UK supply chain.
Learn more at SMMT’s free online seminar: ‘Opportunities for Suppliers’
Coinciding with SMMT’s ‘Opportunities for Suppliers’ Open Forum, a free webinar will be held for companies looking to learn more about the report and how they can benefit from the opportunities identified. The webinar will include presentations from the chairs of the Automotive Council (Richard Parry Jones), Technology Council (Jerry Hardcastle, Nissan) and Supply Chain Council (Bill Parfitt, GM) as well as an overview of the report by its author, Ian Henry, director, AutoAnalysis and an opportunity for open questions. For more information, including a full agenda or to register your interest, visit http://tinyurl.com/yhyxgvn.