Automotive Industry

Business, Energy and Industrial Strategy – in the House of Commons at 12:00 am on 12th June 2018.

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Photo of Colleen Fletcher Colleen Fletcher Opposition Whip (Commons) 12:00 am, 12th June 2018

What steps he is taking to support the automotive industry.

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

The automotive sector is one of our great success stories, and our recently published automotive sector deal, as part of the industrial strategy, sets out how we will continue to support it in future. The partnership continues to deliver results. In April, Vauxhall announced an investment of over £100 million in its Luton plant to build the next generation of Vivaro vans. Last month, the Society of Motor Manufacturers and Traders, the sector body, reported that UK van production had increased by almost a fifth compared with last year.

Photo of Colleen Fletcher Colleen Fletcher Opposition Whip (Commons)

Jaguar Land Rover is one of Coventry’s biggest employers. Recently, JLR revealed its intention to make Coventry the heart of its large-scale battery and electric vehicle production plans. This is welcome news for my city. With that in mind, what support can the Minister offer to Jaguar Land Rover to ensure that Coventry becomes the centre for large-scale battery and electric vehicle production?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

I am grateful for the hon. Lady’s question and I completely agree with her praise and support for that very important employer. JLR’s expansion plans and its plans to make electric vehicles in Coventry are reinforced by the Faraday challenge, which is part of the industrial strategy, and the national battery manufacturing development facility is based at Warwick University’s campus there to support that company and many others besides.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

Does the Secretary of State agree that it would be a cruel irony if Volkswagen, the author of the emissions cheating scandal, were to make large pay-outs in Germany and the United States, which would help those countries to boost their electric vehicle capacity, but made no similar pay-out to help the United Kingdom move ahead in this area?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

My hon. Friend is right that the consequences have to be borne by the companies that cheated the system. We need to make the transition to ultra low emission vehicles to make sure that we lead the world in this area. Just a few weeks ago, Toyota announced a big investment in the future of mobility here in the UK, based on the commitments that we are making as part of our industrial strategy.

Photo of Matt Western Matt Western Labour, Warwick and Leamington

Scrappage schemes have been used in the past to assist businesses and industries in a transition. Has the Minister costed a support package to scrap old diesel vehicles and assist in a managed transition to renewable/alternative energy vehicles?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

The hon. Gentleman is right that we need to see a managed change. Earlier, my right hon. Friend the Minister for Energy and Clean Growth pointed out that the next generation of diesel can play a big part in not only reducing greenhouse gas emissions, but improving air quality. We will shortly be setting out our proposals on how we make the important transition to zero emissions across our vehicle fleet.

Photo of Lucy Allan Lucy Allan Conservative, Telford

Hundreds of jobs in my constituency rely on the Jaguar Land Rover supply chain. Will the Secretary of State tell the House what he is doing to help car manufacturers to deal with the uncertainty of Brexit and the fall in demand for diesel vehicles?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

I will. My hon. Friend is right to comment on the supply chain. A big part of the automotive sector deal, which we concluded with the sector, is to boost the proportion of components that are sourced in the UK. This is a joint commitment that we make, as part of the industrial strategy, but she is also right to draw attention to the importance of our continued ability to trade with the rest of the European Union, free of tariffs and with low friction, so that we can maintain the just-in-time model, which is so crucial to our automotive sector.

Photo of Vincent Cable Vincent Cable Leader of the Liberal Democrats

Following the loss of the Discovery model to Slovakia, which was a decision at least partly influenced by Brexit, what steps is the Minister taking to head off the risk to Jaguar Land Rover’s exports to China where the rules of origin will conflict with the interests of the company in the event that we lose the customs union and we no longer have sufficient UK content in the cars?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

The right hon. Gentleman is wrong about the decision that was made. In fact, it is a decision to prepare Solihull for the next generation of the Range Rover and the Range Rover Sport. JLR described that as a huge investment and a technology upgrade in Solihull, so I hope he will welcome that. He knows that the importance of making sure that we are able to continue to trade—this includes recognising rules of origin not just with the European Union, but around the world—is vital for this company.

Photo of Mark Pawsey Mark Pawsey Conservative, Rugby

Many intending to purchase new cars are unsure what type of engine to opt for, partly as a consequence of Government taxation policies. That is having a serious effect on the British motor manufacturing industry. Will the Secretary of State confirm that there remains a future for clean diesel?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

I will indeed. We are not the only country that is seeing a fall in the sales of diesel. As I and my right hon. Friend the Minister of State have said, clean diesel and the new generations of diesel engines have a very important role to play in the transition to ultra low emission vehicles.

Photo of Laura Pidcock Laura Pidcock Shadow Minister (Business, Energy and Industrial Strategy) (Labour)

Contrary to what the Secretary of State has said, over the past six months nearly 2,000 job losses have been announced in the UK’s automotive sector. This week in the media we have seen speculation about thousands of further redundancies caused by a combination of factors, including worries about possible consequences of a no deal Brexit and the absence of the customs union. May I press the Secretary of State to set out how the Government will work with business, industry bodies and trade unions to ensure security of the automotive industry and those employed in it both in the immediate future and beyond UK’s exit from the EU?

Photo of Greg Clark Greg Clark The Secretary of State for Business, Energy and Industrial Strategy

We work very closely with the industry with great success. Engine production in this country was up over 17% last year, reaching 1 million engines. That is a record. Never in the history of the British motor industry were more engines produced than last year. Over the past year, the net number of jobs that are being created—note the word “created”—in the automotive sector in this country is 9,000.We have a very good record of working closely with the industry to support an industry that is not only very successful today, but will continue to flourish in the future.