By Carol Rose-Burke, Unipart Managing Director, Manufacturing
To strengthen and futureproof the UK’s automotive industry, we must prioritise domestic manufacturing and supply chain capabilities – this requires a focused UK-first approach that fosters collaboration through a comprehensive industrial strategy.
I had the pleasure of taking part in a panel discussion on this issue at SMMT Electrified earlier this month alongside JLR Supply Chain Planning Director Michael Tickle, Bentley Motors Logistics Director Chris Perry and Green Lithium CEO Sean Sargent.
We discussed the challenges and opportunities involved in making the UK a leading location for EV manufacturing and supply chain through an ambitious industrial strategy and affordable clean energy.
There is a sense of urgency around supporting the existing automotive supply base in the UK, and many UK manufacturing businesses in the supply chain are currently struggling to survive. The transition to EVs is putting significant pressure on these businesses, which are dealing with issues of demand volatility and lack of return on investment, and the challenge of responding quickly to changes rippling down the supply chain.
While a lot of attention has been paid to how we address the demand-side challenges around the EV transition, the supply chain issues have not received the same level of focus and support. We must ensure we apply the right intellectual and commercial capacity to solve this.
A second key challenge is the significant investment required to build up the UK’s EV manufacturing capabilities, from battery production to vehicle assembly. Major OEMs have multi-billion pound investments planned over the next few years; Michael Tickle shared JLR’s experience on the panel. This level of capital expenditure is a major challenge for the industry, especially when combined with other cost pressures like high electricity prices.
We must implement an integrated supply chain and cross-sector collaboration to bring these costs down, and make the UK a more attractive prospect for investment through better incentive schemes and policies.
Opportunities
Despite these significant challenges, we also discussed a number of strengths and opportunities that the UK can build upon.
One key strength is the UK’s history of automotive innovation and the skills of its workforce. At Unipart, we are using our Institute of Advanced Manufacturing and Engineering, built in collaboration with Coventry University, to prepare the next generation of highly-skilled engineers. More than £110m of R&D projects have been completed, and more than £500m of economic value has been generated for UK industry. This investment in skills is crucial to capitalising on the UK’s strong automotive clusters in the Midlands, Northwest, and Northeast as hubs of technical expertise and collaboration.
We must better leverage the circular economy opportunity. If the UK can excel in developing a robust circular economy for EV batteries and other key components, there is an opportunity to create an invaluable closed-loop supply of crucial materials, and position the UK as a leader in decarbonised EV manufacturing.
Collaboration between automotive manufacturers, technology firms, energy providers, and policymakers is vital in building a robust EV ecosystem. A more transparent and cooperative approach will help streamline supply chains, reduce risks, and accelerate innovation.
Industry bodies like the SMMT and government agencies play a crucial role in facilitating this collaboration. By fostering an open dialogue between stakeholders and encouraging joint ventures, the UK can create an environment where the EV industry thrives.
My message to the SMMT, the government, our customers, and our industry is to take a UK-first approach and prioritise our domestic manufacturing and supply chain capabilities. Whilst the UK has historically taken a more globalised view, now is the time to focus on collaborating in the UK via a comprehensive industrial strategy that involves targeted R&D, improved incentives, and policy support to enable UK suppliers to scale up and meet the needs of domestic OEMs.