The UK needs to do more to encourage investment in its automotive sector to combat the “fierce” competition from the US and European Union, the head of the sector’s trade body warned. Current low levels of investment in parts of the supply chain put the sector’s long-term viability at risk.
Speaking ahead of Thursday’s government energy policy update, the Society of Motor Manufacturers and Traders’ (SMMT) chief executive, Mike Hawes, said the scale of incentives being offered to electric vehicle (EV) and battery manufacturers elsewhere could “suck up investment from the rest of the world”, citing Volkswagen’s (DE:VOW3) decision to prioritise a new battery plant in North America that could attract almost €10bn (£8.8bn) in assistance.
Although free trade advocates would argue that the market should decide where battery capacity should be built, “it’s not a level playing field”, Hawes said.