AM Online

UK car industry must ‘adapt or die’

THE British motor car industry must be prepared to change and evolve if it is to survive challenges from new markets like China, says an industry expert.

Michael Wynn-Williams argues many companies are living off ‘borrowed’ resources from their global parents and there is no reason why firms like Ford or Jaguar will not shift production to the Far East.

However Wynn-Williams, a contributor to AM-online, who has just completed a PhD thesis at Cardiff Business School on the fate of British car manufacturing, says there is still hope in the British traditions of design and engineering.

He says there is nothing wrong with the UK as a site for car manufacturing - but on the other hand, there is no great advantage either. ‘When well-respected industry commentators point with pride at the latest production figures, they fail to add that this is entirely due to the global plans of multinationals,’ he said.

'It has nothing to do with the UK being a home base.'

The major concern is that with Ford closing the Jaguar plant at Browns Lane, Coventry, they could also relocate the two remaining UK Jaguar plants to the US. Wynn-Williams describes Jaguar as a ‘massive drain’ on its parent company, which also has £200m invested in the Bridgend Ford plant.

‘The main market for Jaguar is in the US and it is quite feasible for production to be moved there,’ he said. ‘With the rise of China there are now even more potential production sites to choose from.

‘There is no reason at all why Ford should not decide to shiftJaguar or Land Rover production there.

‘Indeed, there are rumours that Land Rover Defender production will be moved to Asia to benefit from lower labour costs.

‘Any of these manufacturers are free to move production around the world to suit their global strategies.’

Even the quintessentially British cars like Bentley and Aston Martin are not safe.

Wynn-Williams said: ‘Aston Martin and Bentley exist in their current state due to the largesse of their international parents.

‘There is a feeling that they need to reside here for heritage and marketing reasons, but as stand-alone businesses they have no more chance of surviving now than they did in the past.

#AM_ART_SPLIT# ‘They sustain themselves on hidden subsidies; they 'borrow' resources from their parents that would cost dear on the open market, or they gain special discounts from suppliers on condition that the parent places more lucrative mass market orders.’

But all is not lost if the UK industry is able to shift its focus away from production and towards ideas and design, he argues.

‘While Asian companies are happily churning out cars for foreign multinationals, what they can't do is design and engineer them. This is where the UK industry can step in.

‘You cannot move engineers around - they do not like moving. And there is talent here in the UK.

‘Companies like Ricardo, Lotus and even MG Rover should not be underestimated. The Chinese and Indians desperately need to tap into British talent.

‘This talent is about solving future problems, and it is not possible to buy these companies and ship them abroad because the talent resides in the engineers' heads. This is why Lotus are still in Norfolk, despite being owned by Proton these past few years.’

He argues that while UK car production will be at the whims of global multinationals, a real competitive advantage lies in high- value design work, which the UK can conduct with high quality and remarkably low cost thanks to ‘a spirit of innovation and years of experience’.

‘However, this requires the Government to recognise the importance in supporting these skills and investing in education.’

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