Most of us are probably finding it difficult to feel any festive cheer as November draws to a close – but the industry remains resilient, and our response to every challenge thrown at us this year has revealed our character: determined, adaptable and creative.
That character is again being tested as manufacturing figures out this week show a continuing decline in output from the UK’s car, CV and engine production lines in October. Collectively across all production, the sector is now more than one million units down on the first 10 months of 2019 and, with lockdowns in place across much of the UK and some major European markets through November, we must steel ourselves for more bad news before the year is out.
These are testing times for a sector battered by a triple whammy of Covid, Brexit and, as of last week, the unprecedented challenge of a complete shift to electrified cars and vans in under a decade. However, we remain hopeful for a brighter future, which, with the right support from government, and the right trading conditions, we can keep in our sights.
The Chancellor’s Spending Review this week recognised that the Road to Zero is a long-term aspiration, with initial funding confirmed for electric buses, vehicle charging points and consumer incentives – all measures we have previously identified as crucial to delivering the electric revolution.
However, this is only a one-year commitment, and much more will be needed. We will continue to work with the government on a new industrial strategy in 2021 – starting with the delivery of the Automotive Transformation Fund – to ensure the UK can be a competitive place to produce ultra-low and zero emission cars and powertrains.
Staying competitive also means signing a free trade agreement with the EU that is zero tariff, zero quota, with rules of origin that encompass existing as well as next generation zero emission products. The ‘no deal’ alternative risks a two million unit loss in production up to 2025, worth an eye-watering £55.4 billion over the next five years.
More positively, Covid vaccines appear to be on the way, and there was further good news on Monday that showrooms in England will be permitted to open their doors again – hopefully permanently – from next week. Given the huge contribution these Covid-secure retail outlets make to the economy and a recovery, we need the same to apply to dealerships in every part of the UK.
The pandemic meant we were unable to host our traditional Annual Dinner this year but, in the spirit of automotive, we don’t give up. Instead we were delighted to welcome many of you to its digital replacement: SMMT 2020 Update Live. If you missed it, you can catch-up on the whole event (although you’ll need to supply your own dinner), where we also announced that SMMT’s President, Dr George Gillespie OBE, has kindly agreed to serve a third term in 2021.
I’d like to thank George for his support during what has been an exceptionally challenging time for this sector and am delighted he will stay with us for another year to provide some much-needed continuity. I’d also like to welcome the new SMMT vice presidents, who help stand us in good stead to face another challenging 12 months ahead. They’re ready to serve an incredible industry – UK Automotive, here’s to you.