ACEA

- UNITED KINGDOM

Diverse, competitive and world class

The size and importance to the national economy of the UK’s automotive industry is an impressive example of survival and growth despite the demise over the last 40 years of large-scale national manufacturers. Automotive firms are leaders in many areas of manufacturing in the UK, while the country is home to the world's most successful motor sport industry and a number of leading independent automotive design firms.

Despite the upheavals in recent years, the automotive sector in the UK remains diverse, competitive and world-class. Its crucial importance to the economy is reflected in a manufacturing turnover of over £47 billion (euro 67.4 billion), total direct and indirect employment of 850,000 and a 10% share of national exports. Britain’s world-leading design-engineering companies are highly skilled and technologically sophisticated businesses whose products have a truly international penetration. It is estimated that British firms have a 20 per cent share of the independent global market in vehicle design-engineering.

The range of principal actors in the UK industry is wide and varied. In addition to some of the leaders of world motor sport, they include global volume manufacturers, specialist vehicle makers, component suppliers and design-engineering businesses. Many are examples of excellence in their fields: the Nissan factory in Sunderland and Toyota’s Burnaston facility lead European productivity leagues for car manufacturing; Leyland’s factory in Lancashire supplies 25% of the domestic truck market; component suppliers are in the front rank for technological development.

In recent years, the UK has enjoyed good growth in output of automotive and non-automotive engines. Additional investment by Ford will push up production to over 3.5 million light vehicle engines and up to 400,000 truck and non-automotive engines by the end of the decade.

The core manufacturing, distribution and servicing business in the UK directly generates a turnover value of £200 billion (euro 287.16). In 2006, UK-based manufacturers produced 1.44 million cars, 53% of them carrying Nissan, Honda and Toyota badges. Output is sustained by a significant domestic market for new cars with annual registrations averaging 2.38 million over the last ten years. The equivalent average for vans, trucks, buses and coaches was 331,700. Underpinning these markets is a highly sophisticated, fiercely competitive retail and service/maintenance sector, employing more than 550,000 people and generating added value of some £22 billion (euro 31.5) annually.

* only direct employment; total employment depending on automotive sector is around five times higher

West Midlands cluster

The West Midlands remains the main location for the UK industry, accounting for just under 30% of total UK car production. The region hosts a number of major automotive assemblers: Jaguar, Land Rover, Aston Martin and MG Rover, with over 50,000 people employed in the sector. Sitting alongside manufacturers of key components from driveline to engines and electrics, are a large number of material processing and general engineering firms providing a significant base of expertise.

In total, over 2,600 companies are active in the automotive components sector, ranging from the global players to small and medium-sized businesses. Together they contribute over £4.8 billion (euro 6.9 billion) added value and employ some 132,000 people. The sector exports over £6 billion (euro 8.6 billion) worth of goods annually, 75% destined for Europe and over £1 billion (euro 1.4 billion) worth travelling to the Americas.

R&D cooperation

Technological innovation is a major product of UK’s success in establishing itself as a centre for world-class automotive research and development. Public policies have actively encouraged cooperation between universities and the industry. Important examples include Ford and the University of Warwick while the University of Birmingham is highly active in researching materials for engines and body structures, safety, fuel cells, hydrogen storage and telemetry.

However, pride of place goes to Foresight Vehicle. Here, industry, academia and the Government have come together to create a knowledge transfer network for automotive applications with a strong emphasis on identifying critical technologies for sustainable road transport. Foresight Vehicle embraces over 100 collaborative R&D projects worth more than £100 million (euro 143.5 million). Other important initiatives are constituted by "Cenex" – the Low Carbon and Fuel Cells Centre of Excellence – established in April 2005, jointly funded by industry and the Department of Trade and Industry (DTI), and seeking competitive advantage in shifting to a low carbon economy. The importance of raising skills levels is recognised in the creation of the Automotive Academy. Established by the Society of Motor Manufacturers and Traders in 2004 as a partnership between Government and industry and with over £13 million (euro 18.6 million) backing from the DTI, the Academy offers training from the shop floor through to senior boardroom directors.

• UK - Sustainability Report 2008
• UK - CO2 Report 2006 Market - Overview
• UK - Evolution of the Car