CEO Update

Strengthening global ties will help UK Automotive

06 December 2019 #CEO Update

Another month of decline in car registrations encapsulates the difficulties facing the automotive industry, with buyers holding back for various reasons. Weak consumer confidence, wider economic uncertainty and confusion over policy around clean air zones are all conspiring to depress demand.

There is a bright note in the figures, however, with alternatively fuelled vehicles putting in a strong performance in November, up almost 50% on the same month last year. There is a greater choice for electric and hybrid drivers than ever before, with even more models on the way in 2020, and plenty of enthusiasm among buyers for these exciting new technologies.

That said, with a 10% market share – and that dominated by hybrids – there is still a long way to go for these vehicles to become truly mainstream. To encourage further adoption and establish the UK firmly on the road to zero emission transport, we need fiscal incentives, investment in charging infrastructure and political stability to give buyers confidence to commit to a new purchase.

This week SMMT has been in China and Japan, supporting members with business opportunities and meeting our counterparts in the region as well as other industry stakeholders. With the global economy undergoing turbulence, our international links are as important as they’ve ever been.

We are fortunate to have a relationship with Japan that spans decades, thanks to a mutual commitment to trade, investment and innovation. The trade flows both ways, with more than 40,000 UK-built cars going to Japan in 2018, making it our fourth largest export market, 136,000 vehicles imported from Japan and many more built here by Japanese-owned companies.

The UK has a strong reputation for premium products and world class engineering, and ongoing investment is being made to establish the country as a world leader in electric vehicles – so strengthening our trade ties with Japan will benefit both countries.

For that to continue post-Brexit, however, we need to agree long-term and ambitious agreements with both the European Union and Japan, and to do so quickly so as to ensure existing trade flows continue seamlessly and the UK recovers its reputation as a welcoming and attractive place to invest.

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