UK automotive trade association calls for more UK government support

Core Viewpoint - The UK automotive industry is urging the government to support the Modern Industrial Strategy to restore vehicle manufacturing to 1.3 million units by 2035, as current output is significantly lower at around 700,000 units in 2023, down from 1.5 million in 2018 [1]. Group 1: Government Support and Industry Response - The Society of Motor Manufacturers and Traders (SMMT) warns that fiscal policies threatening the new car market could undermine industrial measures and funding aimed at supporting sector growth [2]. - The sector has welcomed government commitments, including a £2.5 billion fund for innovation and productivity, and trade deals with the US and India, indicating recognition of the automotive sector's importance for economic prosperity and decarbonisation [3]. Group 2: Concerns Over Upcoming Fiscal Policies - The SMMT expresses concern that measures proposed ahead of the Autumn Budget could negate government support and inflict severe damage on the industry [4]. - A proposed pay-per-mile tax on electric cars could suppress demand and make achieving sales targets more challenging, according to the SMMT [4]. Group 3: Market Dynamics and Investment Risks - The share of Battery Electric Vehicles (BEVs) in UK new car sales has reached 25%, with a government target of 28% for 2025, which could lead to penalties for companies failing to meet volume targets [5]. - The industry has already spent £8.5 billion on EV discounts to meet targets, and further measures that weaken demand could deter investors and shrink the market [5]. - Proposals from the last UK Budget threaten investment, with plans to end Employee Car Ownership Schemes potentially costing the industry and government £1.5 billion annually and putting 5,000 manufacturing jobs at risk [6].