Automotive industry to source more UK-made components

Saturday, Nov 08, 2014

The percentage of UK manufactured components going into British-made cars must increase, industry analysts have said.

The amount of British-made components going into UK produced vehicles is only around 35%, much lower than in the rest of Europe. In Italy then figure can be as high as 55%.

With the UK motor industry enjoying such a renaissance then analysts have said that more should be done to bolster the UK’s component supply sector; a sector which takes on added significance to the West Midlands due to its over-reliance on the automotive supply chain.

The issue is set to be addressed at a conference in Birmingham later this month, organised by the head of the Aluminium Federation.

The two-day Aluminium in Road Transport Conference is set to bring together leading engineers and designers from the likes of Jaguar Land Rover, Morgan Motor Company, Lotus and others. The conference takes place at the Thinktank, Millennium Point on November 11 and 12.

Speaking ahead of the conference, ALFED CEO Will Savage said: “Clearly we have a lot to be proud of in our motor manufacturing industry, as over the past decade Britain has become a global leader in automotive production again. However, there is a depressing statistic behind this success and that is that around two-thirds of parts used in British built cars are sourced from overseas. 

“At ALFED we want to see a huge change in that ratio, and it can be done, because we know that we possess the skills, innovation potential and capacity here in the UK to build more of the components that our automotive manufacturers need.” 

He said a large part of the problem was legislation and the industry needed the Government to lower the legislative burden on companies, particularly in terms of the cost of energy. 

For example, he said UK firms are paying twice as much as their French counterparts. 

“Levelling the playing field in this respect would go a long way to increasing production of car components in the UK,” he said.

Mr Savage outlined a five-point plan that his organisation believes would assist UK automotive manufacturers to use more home-produced parts:

  • •    Ensure taxes on manufacturers do not exceed those applied to businesses in Continental Europe
  • •    Offer tax relief and financial incentives to assist firms to set up car component production
  • •    Cut import duties on materials used in car component production
  • •    Offer relocation grants to help firms reshore to the UK
  • •    Make sure finance is available to component firms looking to tool up to meet demand

Implementing these measures would go a long way towards reducing the cost burden to car component production and provide a much-needed boost to re-establishing UK supply chains.

“There might be an initial Government input, but this would be paid back significantly in the long-term through increased wealth and prosperity in the UK,” he added.

JLR is trying to source more of its parts in the UK, however, the industry as a whole is not as proactive.

ALFED’s Aluminium in Road Transport Conference will discuss Innovation and Technology and Sustainability and Recycling amongst other pressing industry topics. It also features an evening dinner at Birmingham’s Council House with after dinner speaker Adam Hart-Davis, in addition to a tour of Land Rover’s state-of-the-art plant in Solihull.