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As Bridgend discusses plans to shut down the Ford engine plant in the city of South Wales, the government is asking more and more questions about whether it is doing enough to ensure the future of the city. British car construction.
Ford's announcement Thursday of the closure of its Bridgend plant with the loss of 1,700 jobs in 2020 echoes Honda's plans to close its Swindon auto plant. Nissan has canceled the production of several models of vehicles from its Sunderland plant.
The UK automotive industry has been boosted by a large number of foreign investments led by Japanese automakers in the 1980s and 1990s, but it is now struggling to secure new investment spending to protect existing plants despite uncertainties over the period. Brexit.
And the sector is also likely to lose money in the in-depth transition from gasoline and diesel cars to electric cars.
Next week, ministers will try to strengthen the industry's prospects with government funding of £ 23 million for the development of the electric car battery, according to familiar information.
The money will be used to fund various projects, including Jaguar Land Rover, the UK's largest automaker, to improve battery performance. This adds up to government funding of £ 246 million for a series of battery – driven businesses.
But David Bailey, professor of business economics at the Business School at the University of Birmingham, said the £ 23 million was a "symbolic gesture". "Governments are investing heavily elsewhere, as well as businesses," he added. "The scale of investment elsewhere is less than what we are trying to do here."
Ian Henry, visiting professor at the Brexit Studies Center at Birmingham City University, said, "If the government invests, it must be hailed, but it's a pitiful beer compared to the tens of billions spent by private sector companies. in Germany and Japan. "
Ford's decision to close its Bridgend plant – due to the loss of a contract with JLR and dwindling demand for its car engines – has brought to light other troubled factories.
It is Ford's latest manufacturing facility in Dagenham, UK, which produces diesel engines for vans and light trucks. Like Bridgend, Dagenham has lost a key contract with JLR, but Ford is more optimistic about the Esbad site's fortunes because the engines it manufactures for commercial vans are popular.
JLR, owned by the Indian company Tata, faces questions about the future of its factory in Castle Bromwich, which manufactures Jaguar sedans with declining sales. Last month, JLR's director, Ralf Speth, told FT's Future of the Car Summit that the company "had a plan" for the Midlands site, which would have long made the inclusion of the manufacturing of electric vehicles.
The company plans to manufacture batteries in the UK and signed an agreement with BMW in Germany last week to develop a new electric vehicle technology that JLR plans to manufacture in Britain.
The Vauxhall plant at Ellesmere Harbor appears to be the most exposed because it imports three quarters of its components and exports 80% of the vehicles manufactured there in Europe. PSA, the owner of Vauxhall, has repeatedly stated its intention to keep the Wirral site open. It cut nearly 1,000 jobs and moved to a single workstation to improve efficiency.
The future of the Ellesmere Port plant will depend on the reconfiguration of the Astra when a new version of the car will be developed within two years: a problem still made difficult by the capacity of other PSA plants in France to manufacture the vehicle.
The impending Astra decision shows how automakers are modernizing their vehicles about every seven years, with manufacturing decisions generally being made two to three years before production begins.
This means that car manufacturers are constantly ready to fight, aware of the need to surpbad competing sites within the same company to remain viable.
Greg Clark, secretary of business, told the Financial Times that there were reasons to be optimistic with the British auto industry, noting that Toyota had decided in 2017 to invest 240 million British pounds in new tooling equipment at its Burnaston plant in Derbyshire. "When we are in the running, we can win and we did it there," he added.
Mr Clark also insisted that British industry could survive and thrive in the shift to electric cars. "This is not the case that we have bet on diesel and gasoline and that we are left behind, quite the contrary," he said.
But the government has a limited influence on the future of the sector: important decisions about British car factories are made by owners scattered around the world. "Everyone must understand that decisions are not made in the UK, with the exception of JLR," said Ian Robertson, an industry advocate who spent a decade on the main draw from BMW.
At present, Brexit is the most important factor affecting the UK's attractiveness as a car production site.
Uncertainty over UK vote for EU exit puts a brake on new investment, which has fallen 80% in the last three years, according to the Society of Motor Manufacturers and Traders.
Mike Hawes, Managing Director of the SMMT, said: "This permanent uncertainty is corrosive, both on the operations of the automotive plants and on their reputation."
Steel fabrication for more problems
The UK car industry is not alone in being under pressure. Two of the country's oldest manufacturers, British Steel and Short Brothers, the Northern Ireland aerospace firm now owned by Bombardier, are on sale, raising questions about the state of the industry.
British Steel, owned by private investment firm Greybull Capital, went into liquidation last month and the official receiver now has control and is looking for a buyer for the company.
Last month, Bombardier's operations in Belfast, focused on the manufacture of fuselages and aircraft wings, after years of trying to break Airbus and Boeing's hold on jet production .
In both cases, the uncertainty created by Brexit played only a partial role. If the delay in the departure of the United Kingdom from the European Union was delayed by the decision of British Steel – this led Brussels to suspend the granting of carbon credits to British companies, leaving the steelmaker struggling with a lack to win – the roots are much deeper.
The contraction in the UK steel industry has suffered from decades of underinvestment that has left it struggling with global competition. Former staff members said that British Steel, which operates in the UK at Scunthorpe, could put up to £ 500 million to bring its badets up to standard.
Other factors that have contributed to the difficulties in the steel sector include an overabundance of production, partly attributable to China, as well as high levels of imports into the EU that have lowered metal prices. Steel producers also complain that the prices of industrial energy in the UK are much higher than in many other countries of the EU.
Bombardier had warned of the impact of a tough Brexit on its operations in Northern Ireland, but the company did not mention it when selling the business in Belfast.
Bombardier's interests in Northern Ireland date back to the late 1980s, the year of the acquisition of Short Brothers, one of the oldest names in aviation.
The main factory manufactures wings for what was previously known as the C-Series aircraft, which, according to Bombardier, would break the hegemony of Boeing and Airbus in the segment narrower jet market.
However, Bombardier struggled to secure orders for Series C and was bailed out in 2017 by Airbus, which took control of the project for one Canadian dollar and renamed it A220.
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