£1 billion secured for new Sunderland gigafactory: comment

“This is exactly the type of investment that is needed if the UK’s car industry’s future is to be secured. 80% of the cars built in Britain are exported, and global sales of EVs are only going in one direction – up. The future of our car industry depends on successfully moving with this trend, with the Government supporting the car industry in carving out a space for itself in the decades ahead by making a rapid transition to building the electric cars of the future.

“Analysis from CBI Economics has shown that by slowing the transition to EVs, clinging to old technologies, the UK risks repeating the mistakes of the 70s and 80s, leading to a rusting car industry, billions in export revenue foregone, factories closing and hundreds of thousands of jobs being lost. Go fast, and our car industry will not only survive, it will thrive, with earnings increasing and thousands of new, highly-skilled and well-paid jobs being created”.

CBI Economics [2] found that the UK’s automotive sector currently contributes £46.8bn in Gross Value Added (GVA) and supports over 552,000 FTE (Full-Time Equivalent) jobs. The report revealed that a failure by the car industry to make the transition to manufacturing EVs could see its contributions to the UK economy fall by as much as 73%, or £34.1bn, and over 400,000 jobs could be lost. Conversely, economic output could increase by 35%, or £16bn, and 167,000 new jobs could be created, if a rapid and successful transition takes place. Government support is critical if this best case scenario is to be secured, and the worst case scenario avoided.  Such support includes the provision of incentives and investments to leverage private capital and expand supply chains, as well as providing a stable and supportive regulatory environment through keeping measures like the ZEV Mandate in place.