Billion pound commitment to power UK auto sector to the future

• The government and automotive industry are investing £500 million each over the next ten years in an Advanced Propulsion Centre
• Automotive Council members aiming to recruit more than 7,600 apprentices and 1,700 graduates over the next five years
• The Automotive Investment Organisation is aiming to double the number of jobs created or secured in the automotive supply chain through Foreign Direct Investment over the next three years to 15,000
• Technology Strategy Board launches new £10 million competition for research and development low carbon vehicle projects

The government and automotive industry are investing £500 million each over the next ten years in an Advanced Propulsion Centre (APC) to research, develop and commercialise the technologies for the vehicles of the future.

Backed by 27 companies in the sector, including supply chain companies, the commitment is expected to secure at least 30,000 jobs currently linked to producing engines and create many more in the supply chain.

The announcement was made today at the Goodwood Festival of Speed by the Business Secretary Vince Cable and Professor Richard Parry-Jones who both co-chair the Automotive Council.

It forms part of Driving success – an industrial strategy for growth and sustainability in the UK automotive sector published jointly by the government and industry. It follows the recent plans for construction, aerospace and other key sectors to secure sustainable future growth in the economy.

With £6 billion of investment in the UK over the last two years, 1.58 million vehicles produced in 2012, and four out of five vehicles exported to 100 countries worldwide, the automotive sector has transformed itself into a real UK success story.

This strategy sets out how the UK can secure the long term future of the industry over the next 20 to 30 years by growing the UK share of the value chain and by getting ahead of the game in research and development (R&D) on low carbon vehicles.

The report looks at four key themes:

• technology: how our vehicles are powered in future; from 2040 they will no longer have the traditional petrol or diesel engines as we know them
• supply chain: how government and industry can work together to grow the UK supply chain and win more overseas business
• skills: how the right skills are in place to build on the success of the sector
• business environment: how to maintain the UK’s competitiveness in the global auto industry

Business Secretary Vince Cable said:

The UK automotive sector has been incredibly successful in recent times, with billions of pounds of investment and new jobs. This has been achieved by government and industry working together. With the next generation of vehicles set to be powered by radically different technologies we need to maintain this momentum and act now. Our industrial strategy will ensure we keep on working together to make our automotive industry a world leader.

Professor Richard Parry-Jones said:

Businesses prefer consistency, stability and a clear path to the future in order to make investment plans. Driving Success, the automotive industrial strategy, sets out how industry will work together with the government over the next 20 or 30 years. This is critical to sustaining and growing a thriving UK automotive sector in a highly competitive global industry.

Last month Vince Cable announced the setting up of the Automotive Investment Organisation, headed up by Joe Greenwell, the former chairman of Ford of Britain, to lead on attracting inward investment in the UK. Over the past three years we have seen just over 7,500 jobs created or safeguarded in the automotive supply chain through foreign direct investment. It was announced today that the Automotive Investment Organisation is aiming to double this figure to more than 15,000 jobs created or secured over the next three years.

The strategy also outlines some of the challenges the sector faces including the need for a skilled workforce. Industry members of the Automotive Council and its working groups expect to recruit more than 7,600 apprentices and 1,700 graduates over the next five years.

The Technology Strategy Board launched a £10 million competition today that could see successful projects fast tracked for commercialisation through the Advanced Propulsion Centre. Businesses are being invited to bid for support on innovative collaborative low carbon vehicle projects.