CEO Update

A green recovery must address market and manufacturing

11 June 2021 #CEO Update

The last two months have brought a cautious optimism that a recovery from the pandemic is forthcoming. Despite registration and manufacturing figures throughout April and May being lower than long-term averages, they were as good as could reasonably have been expected, with van registrations a bright spot, thanks to record sales as the demand for online deliveries has soared.

Crucial to a post-pandemic recovery will be the focus on green technologies, a topic which is set to be discussed at the G7 Summit in Cornwall this week, and one that featured in SMMT’s Open Forum, hosted online on Tuesday. The industry faces significant challenges in this transition, but with 13.8% of cars sold thus far in the UK in 2021 capable of being plugged in – up from 7.2% over the same period last year – progress is accelerating.

Demand for electrified vehicles is being driven largely by businesses and fleets. Private consumers, on the other hand, are more likely to hold back, with concerns about charging, cost and range. If the sector is to meet its ambitious net zero targets and achieve a green recovery, the government must help by providing a plan with long-term fiscal incentives and invest in on-street public charging infrastructure to boost consumer confidence and take up of electrified vehicles.

UK automotive manufacturing has also suffered during the pandemic with lockdowns significantly decreasing the demand for vehicles both domestically and internationally, leading to reduced output. Companies are now subject to a global semiconductor shortage and increased costs to trading with the EU which is causing unpredictability and undermining operations. This is primarily a Covid-related issue and, as such, the industry may need the continuation of sector specific support in a number of ways to help manage the situation.

Looking more broadly, with G7 bringing international leaders to the UK, government must not lose sight of the need for free and fair trade deals that reflect the interests of the UK automotive industry. We need manufacturing to recover quickly but also assure it’s long term competitiveness. This is about the root and branch costs manufacturers face across the UK but also how we manage the transition to new technologies across the supply chain.

Electrification, international trade and recovery are all hot topics set to be high on the agenda at SMMT’s International Automotive Summit, on Tuesday 29 June.

We can now announce that Michael Straughan, Chief Operating Officer, Aston Martin Lagonda and Joerg Hofmann, Chief Executive, LEVC, will be joining keynote speakers including, Alison Jones, UK Managing Director and Senior Vice President, Stellantis, Thierry Bolloré, Chief Executive Officer, Jaguar Land Rover and Michael Cole, President and Chief Executive, Hyundai Motor Europe.

You can view the full agenda here and for more information on tickets, which are free for members, sponsorship opportunities, or to register, please contact our events team via email at SMMTSummit@smmt.co.uk.