UK auto industry urges government to step in
Author: Robin Brown
Published: 20 November 2008
The Retail Motor Industry Federation (RMIF) and the Society of Motor Manufacturers and Traders (SMMT) have written a joint letter to the government calling for help for the UK's automotive industry during the economic slump.
The automotive trade organisations want a range of measures to help stimulate the motor sector, which have been outlined in a communication to Chancellor of the Exchequer Alistair Darling and Business Secretary Peter Mandelson.
The measures include providing more accessible cash for finance houses within the industry that will allow dealers and manufacturers to offer deals to consumers
Scrapping plans to increase VED and reform business car capital allowances are also high on the agenda.
The move has been prompted by the worsening in economic conditions that has led to all manufacturers with plants in the UK laying off staff or idling factories.
The precarious situation of Ford and GM will also have influenced the decision. It is understood that GM-owned Opel has met with the German government to discuss its future in the eventuality that GM goes under.
While the US debates a package to save its auto industry and the EU prepares a £30bn loan fund, SMMT and RMIF want the UK government to commit to an independent package now, which it says is vital in order to safeguard jobs.
Commenting on the move, Paul Williams, RMIF Chairman said: "It is vital that the motor industry present a united front at this time. These measures and others, jointly presented by the two industry trade associations, would go some way to helping the revival of consumer confidence in our sector. We urge the Chancellor to undertake these measures, and to discuss further action with us if necessary."
Paul Everitt, SMMT Chief Executive said: "The motor industry faces a set of unprecedented market conditions. The dramatic falls in demand for new vehicles in the UK, Europe and around the world, combined with the limited availability of funding and liquidity now puts at risk valuable industrial capability.
"Urgent action is required to boost demand for new vehicles and ease pressure on UK automotive suppliers. The Pre-Budget report should set out the strategy and measures needed to restore consumer confidence and support valuable industrial capability during this difficult period."
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