In a historic landslide victory, Labour has brought an end to 14 years of Conservative rule. Keir Starmer, in his victory speech, spoke of a “sunlight of hope” and an “age of national renewal,” which has many in the automotive industry both hopeful and expectant. The automotive sector, a cornerstone of the UK’s industrial landscape, eagerly anticipates the policies and changes that Labour’s new government will bring. This blog will delve into Labour’s manifesto promises for the automotive industry and the key areas where industry experts are calling for action.
Labour’s Automotive Manifesto Pledges
During the election campaign, Labour pledged to tackle several key issues within the automotive industry. These promises are critical to monitor, as their fulfilment will significantly impact the sector’s future. Here are the major pledges Labour made:
Reinstate the 2030 ICE Ban
One of the most significant pledges Labour made was to reinstate the 2030 ban on the sale of new petrol and diesel cars. This comes after the Conservatives pushed the date back to 2035. Labour argues that reverting to the original date will provide much-needed certainty for car manufacturers. This bold move signals a strong commitment to accelerating the transition to electric vehicles (EVs).
Help EV Buyers
Labour has promised to support EV buyers by accelerating the rollout of charge points across the UK. As of May 2024, there were 12,249 rapid or ultra-rapid chargers at 5,336 sites, according to EV firm Zap-Map. The party also aims to introduce a battery health standard for the used EV market, ensuring buyers have clear and understandable information about battery condition. However, it’s worth noting that Labour has not promised any direct incentives for buying EVs.
Creating a Modern Transport System
Labour has pledged major upgrades to Britain’s roads, addressing the long-standing issue of potholes, which the RAC estimates number over one million across the UK. This will be funded by deferring the Arundel bypass on the A27, which Labour deems “poor value for money.” The party aims to rebuild Britain by modernising transport infrastructure, ensuring that the network is not plagued by long-promised but undelivered projects.
Battery Factories
To ensure that the UK’s automotive industry leads the world, Labour plans to update national planning policy to facilitate the construction of EV battery factories. The party has pledged £1.5 billion for new gigafactory projects and an additional £500 million for green hydrogen manufacturing projects, which could particularly benefit the future of HGV powertrains. There is also a commitment to invest in the UK’s R&D sector, which includes automotive.
Lower Insurance Costs
Labour has acknowledged the soaring cost of car insurance and has committed to tackling this issue, although specific details on how this will be achieved are yet to be revealed. The Association of British Insurers has attributed rising costs to several factors, including the price of parts, repairs, replacement cars, and an increase in personal injury claims.
What the Automotive Industry Wants to See
Labour’s victory has been applauded by both the BMW Group and Vauxhall owner Stellantis, the UK’s two biggest manufacturers, with major factories in Oxford and Ellesmere Port.
Stellantis UK boss Maria Grazia Davino said: “We congratulate Keir Starmer on his party’s election win. We now look forward to working with the new government on its industrial strategy to improve UK competitiveness, manufacturing, electrification and the ultimate aim of net zero.”
BMW said in a statement: “We look forward to engaging with the new government on the important issues facing the automotive industry.” These aren’t the only two industry players that are now looking to work with the new government to tackle the challenges facing the industry. Here are some key areas where industry experts are calling for action:
Fleets, Taxes, and the EV Transition
Gerry Keaney, Chief Executive of the BVRLA, has emphasised the need for targeted actions to support the transition to cleaner vehicles. While decarbonisation policies have driven significant adoption among fleets, retail and rental sectors have lagged. Keaney calls for specific interventions to boost the charging infrastructure, used market, and electric vans. The Association of Fleet Professionals (AFP) echoes this sentiment, urging the new government to extend company car Benefit-in-Kind (BiK) taxation tables and clarify plans for the Zero Emission Vehicle (ZEV) mandate.
Charging Infrastructure and Incentives
David Savage from Geotab and Jon Lawes from Novuna Vehicle Solutions both stress the importance of stability and confidence for businesses. They call for decisive action to address EV adoption barriers, including investment in charging infrastructure and policy incentives. Adam Hall from Drax Electric Vehicles highlights the need for government grants and subsidies to support the EV industry, along with clarity on future company car tax rates and the continuation of the Plug-in Van Grant and Workplace Charging Scheme.
Roads and Motoring
The RAC has outlined several priorities for the new government, including improving local roads, reducing the motor insurance tax burden, making fuel prices fairer, cutting road casualties, and supporting the transition to EVs. The organisation emphasises the importance of addressing the poor state of local roads, rising insurance premiums, and high fuel prices, which are top concerns for UK motorists.
Automotive Sector and Manufacturing
Mike Hawes from the SMMT and Philip Nothard from Cox Automotive both highlight the automotive sector’s critical role in achieving net zero and economic growth. They urge the new government to support manufacturing competitiveness, enhance trade relations, and provide clear strategies for the sector’s future. Investment in skills and training is also a key priority, with industry leaders calling for more support to attract and train the necessary workforce for the automotive industry’s evolving needs.
UK Charging Infrastructure
Industry leaders like Mike Nakrani from VEV and Antoine Picron from ChargePoint emphasise the need for bold action on charging infrastructure. They advocate for accelerated charge point rollout and support for fleet owners to build their own charging infrastructure. Suggestions include opening up local authority land for private companies to install EV chargers and reducing VAT on public charging costs to encourage EV adoption.
Hydrogen Future
Robin Futcher from Commercial Fuel Solutions points to Labour’s commitment to green hydrogen as a potential game-changer for the UK’s hydrogen industry. The proposed £500 million fund and swift policy action could attract significant investment, supporting the sector’s growth and positioning the UK as a global leader in hydrogen technology.
Taxi Sector Challenges
Chris Allen from LEVC and Sam Pooke from Freenow UK highlight the need for targeted consumer incentives for commercial and niche vehicle drivers, including taxis. They call for the continuation of the Plug-in Taxi Grant and removal of VAT from public charging networks to make EV adoption more equitable for all drivers, including those without access to home charging.
Energy Solutions and Gigafactory Plans
Richard Moore from Greenpower Park and other industry experts stress the importance of securing global battery manufacturers and developing a robust supply chain for EV batteries. They call for strategic investment in gigafactories and associated infrastructure to meet the growing demand for electrification across various sectors.
The Automotive Talent Landscape and Jobs
Labour’s ambitious plans for the automotive industry will significantly impact the job market and the skills required within the sector. Investment in EV battery factories and R&D will create a demand for a highly skilled workforce, necessitating substantial education and training programmes. Thousands of new jobs are expected in manufacturing, construction, engineering, and maintenance due to new gigafactories and expanded EV infrastructure. The shift from internal combustion engines to electric powertrains will require support programmes for workers transitioning to new roles. This is an exciting time for the industry, and getting ahead of the game now by securing the best talent will put your business at the forefront of this growth.
———-
Labour’s historic victory brings with it a promise of change and renewal. The automotive industry, a vital part of the UK’s economy, stands ready to embrace these changes and work with the new government to build a sustainable, innovative, and competitive future. The pledges made in Labour’s manifesto are a significant step forward, but the industry’s calls for targeted action, investment, and clarity will be crucial to ensuring that the UK remains a global leader in automotive technology and green energy.
To stay ahead and secure the best talent now, get in touch with us. We can help you navigate this exciting period of growth and ensure your business is positioned to lead the industry.
< back to other articles
