When SMMT produced its first annual sustainability report for the automotive industry in 2000, it was the starting flag for two decades of continuous and demonstrable improvement. Manufacturers have invested heavily to increase production efficiency, develop cleaner, greener, lower emission vehicles, and upskill an already talented workforce to meet the challenges ahead. With the automotive sector’s reputation for innovation and improvement, the industry could confidently predict it would deliver. What could not have been predicted by anyone, however, was a once-in-a-century global pandemic, which effectively shut down the economy, as society hunkered down, focusing all efforts on tackling the clear and present danger.
Even as this report is published, the pandemic remains the priority, with supply chains disrupted, staff isolating, and economic growth erratic. In 2020, UK new car production fell -29.3% to just 921,928 units – the weakest performance since 1984, as the pandemic stifled demand and shuttered factories. Automotive plants, however, never quite shut – they still require power and water, maintenance and servicing. More importantly, many companies used this downtime as an opportunity to help repurpose production lines to essential PPE and ventilator manufacturing to support the NHS during the crisis.
Unsurprisingly, those unprecedented circumstances and the consequent production stoppages reduced operational efficiency, efficiency that had been refined and honed over many years. Even against the most disrupted production backdrop in history, the industry still built vehicles using, on average, -14.2% less energy and -36.8% less water than in 1999 – a monumental achievement and testament to the progress made over the past two decades. Plus, with electric vehicles accounting for more than one in 10 registrations, 2020 saw average new car CO2 emissions fall by -11.8% in a single year.
While the pandemic is by no means in the rear-view mirror, the success of the vaccine programme and the reopening of the UK economy means the industry can begin to refocus on recovery and future ambition. With the end of sale of conventional new petrol and diesel cars now confirmed for 2030, and a consultation now open on similar targets for heavy goods vehicles, manufacturers must transition at incredible pace. All are committed to net zero and every signatory to this report has made a commitment to reach net zero by 2050 – with many expecting to achieve this far sooner. Beyond environmental sustainability, the industry continues to invest in economic development and employment. Success increasingly depends on gigafactory investment, which could create 40,000 further jobs across the wider supply chain by 2040. However, as well as batteries, electrification will require many in the sector to transform their skill sets, and a commitment to
upskilling as new technologies emerge and become mainstream.
New jobs are an opportunity to widen diversity in the sector, so that automotive can better reflect the society from which it recruits and the market into which it sells. There is progress, with one in eight people working for this report’s signatories women – the highest proportion ever recorded – but this illustrates just how much more needs to be done. Gender is only one attribute of diversity and all signatories are committed to improvement in other areas, but more work is needed before we can say the industry is truly diverse and inclusive.
The year 2020 was one like no other. But despite the myriad challenges it brought, the automotive industry’s commitment to sustainability remains unchanged. In the year the UK hosts the COP26 Summit, the sector continues to invest to reduce carbon emissions even further and reach net zero. We must deliver that goal while keeping society on the move and providing mobility for all.