Increased car production could boost UK supply chain by 28,000 jobs, says report

Will Green is news editor of Supply Management
21 October 2015

Up to 28,000 new supply chain jobs could be created in the automotive sector by 2020 because of rising UK car production, according to a report.

The Society of Motor Manufacturers and Traders (SMMT) said the move to internet-connected cars and autonomous technology presented “significant opportunities for British component suppliers in the coming years”.

In a report the SMMT said UK car production is expected to rise to two million vehicles annually by 2020, up on 1.5 million currently. This will require up to an additional 9,500 employees at manufacturing plants, and almost three times that number at the component companies that supply them.

Mike Hawes, SMMT chief executive, said, “The recovery of the UK automotive supply chain is gathering pace, and this new report shows that the opportunities for further growth and development will be plentiful in the coming years, particularly as the drive towards fully connected and autonomous vehicle technologies accelerates.

“A strong domestic supply chain is crucial to the success of the industry as a whole, and crucial to attracting new inward investment, so it is critical that the support from government-industry partnerships we have enjoyed in recent years continues to ensure the sector is able to realise its full potential.”

SMMT said 41 per cent of the average UK-built vehicle was locally sourced, up from 36 per cent in 2011, and there was the potential to produce up to 80 per cent of car components in the country. By comparison, in Germany 60 per cent of automotive components are locally sourced.

The report said currently around 160,000 people are employed in UK automotive manufacturing and the wider supply chain.

The SMMT said its predictions were based on the assumption that the UK remains in the EU, while regulatory costs and possible effects from the Chinese slowdown could also have a bearing on the industry.

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