UK Edition
The UK must slash red tape on building gigafactories and cut electricity prices by unpegging them from gas to attract the investment needed to rescue sinking production, the car industry has warned.
UK manufacturers pay higher electricity prices than competitors in the EU in spite of the comparatively high and rising proportion of wind energy available, partly because electricity prices are set using the price of once-cheap methane which has shot up in price.
Fixing this and making battery plant building easier could give the industry the boost it needs, the Society of Motor Manufacturers and Traders said. The proportion of electric vehicles being made is rising, but local battery supply is crucial, the trade body said.
SMMT chief executive Mike Hawes said: “Britain boasts a firm foundation of EV production, backed by low carbon energy, outstanding R&D and a highly skilled and productive workforce. We must not squander these advantages.”
UK car production has halved in the past five years and further shrinkages risk the viability of the industry as suppliers lose work and leave, Nissan boss Ashwani Gupta, the Japanese company’s chief operating officer, said last month.
Mr Gupta said: “The UK is becoming more and more challenging as a manufacturing footprint.”
He was joined by Carlos Tavares, head of Vauxhall owner Stellantis, in warning that a declining industry and no new battery plants spelled a bleak future for British car making.
“The big problem of the UK is to keep a size of market that would support the investments [in] battery supply,” Mr Tavares said in February. “I fear that if you don't have the battery supply in the UK, for the UK, the market will be in trouble.”
The plea follows broader manufacturing lobby group Make UK’s request last week for Prime Minister Rishi Sunak to create an industrial strategy in part to attract battery plants for car making.
It comes as one of Britain’s most promising driverless car companies has warned it could start testing its systems abroad as ministers drag their feet over new laws allowing advanced trials of the technology.
Wayve, which is backed by Microsoft and Sir Richard Branson, said the lack of rules allowing driverless car companies to test vehicles without human safety drivers or to run commercial services meant it could expand abroad instead of in Britain.
The Government announced plans last year to introduce new laws for driverless cars as part of an exhaustive transport bill, but the complexities of the wide-ranging legislation, which would cover railways to pedicabs, has seen it delayed.
Wayve’s director of public policy Sarah Gates said driverless car legislation has not moved on since 2016, when it was considered world leading, and delays could force the company to consider other markets.
She said: “We’re fully committed to the UK currently. But if you don't legalise the deployment of the technology, any company would then have to look at what are our options for making sure that we can bring this technology to market.
“The UK will quickly move from being pro-innovation and facilitating developers to actually being really quite far behind, because the technology is now surpassing UK policy."
Wayve, which has deals with Ocado and Asda to test driverless deliveries, has tested its technology in several cities across the UK. But laws still require it to use a human safety driver and prevent it from launching full services. In the US, driverless car companies Waymo and Cruise have both completed more than 1m miles of testing without a safety driver.
“We do not have legal certainty around the ability to remove the driver,” Ms Gates said. “What the bill gives you is a framework for full commercial deployment, so when you’re actually carrying goods and people [you can] replace the driver. Neither of those things currently exists in the UK.”
She said the company had not identified a likely destination for overseas testing, but pointed to France, Germany and the US among the countries with promising sets of rules.
“I wouldn’t be able to say where Wayve might go, but given the amount of progress that’s happening across many different regions and countries now, there will be lots of choice, the UK is really lagging behind,” Ms Gates said.
A Department for Transport spokesman said: “We are committed to developing flexible, innovation-friendly frameworks for transport which drive growth, investment and skilled jobs and create safer, greener transport choices for the public.
“The Future of Transport measures remain a legislative priority and we will introduce these when parliamentary time allows.”