The UK’s motor industry is still waiting to hear whether the Labour government’s promise of a £5,000 subsidy for electric vehicle buyers will be upheld by the new coalition administration.

Business Secretary Vince Cable told delegates at yesterday’s SMMT International Automotive Summit that he understood their frustration at the review but he could not tell them the outcome, and insisted it would be a decision made by another colleague in the Department for Business Innovation and Skills.

Cable, an oil industry executive before he became an MP, told the SMMT gathering that automotive was the “hinge on which the economy depends” with its 800,000 employees and 10% contribution to national exports.

“If we get a recovery it has got to be export led,” he added.

However Cable warned that direct support such as scrappage and the Automotive Assistance Programme was over and the UK would not fight a subsidy war against other countries.

“We’re just emerging out of a period of very heavy government intervention. We’re now in a new era, in a different world,” he said.

“We don’t see a future in terms of large scale Government support for particular companies.”

The new administration wants to work in partnership with the automotive sector and needs to work out the best way it can help, such as through investment for research, skills and apprenticeships, he said.