British automotive manufacturers are calling for urgent action on spiralling costs as new analysis from the Society of Motor Manufacturers and Traders (SMMT) reveals firms face a GBP90m uplift in energy bills this year – equivalent to more than 2,500 automotive jobs – as costs surge by 50%.
The SMMT also points out that UK electricity prices are the most expensive of any European automotive manufacturing country and 59% higher than the EU average, meaning that last year, UK manufacturers could have saved almost £50 million on energy costs if they were buying in the EU rather than the UK.
The SMMT also warns that the additional cost of producing vehicles and components in the UK is putting manufacturers at a competitive disadvantage, stalling momentum at the very time the sector needs to make massive investments to meet accelerated timescales for zero emission transformation.
The SMMT also said that since March and war in Ukraine, energy prices have surged at the same time as battery producers and the sector must urgently accelerate and broaden this investment to SMEs across the supply base.
In an address to an SMMT conference, CEO Mike Hawes emphasised the competitive dangers for the UK auto industry and appealed for help with energy costs from the government. “The situation has now worsened significantly, more severely than many of our competitors,” he said.
“Help with energy costs now, will not just help us stabilise, help keep us competitive, it will also help government deliver its climate change commitments. Costs saved can be a windfall for investment in innovation, R&D, training – reinvested in the UK economy and the UK’s net zero future.”