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Business Minister Shriti Vadera announces new investigation into automotive industry

DEPARTMENT FOR BUSINESS, ENTERPRISE AND REGULATORY REFORM News Release (2008/074) issued by The Government News Network on 7 April 2008

Business Minister Shriti Vadera today launched a new investigation into the UK's automotive industry to identify measures to tackle the twin challenges of low cost competition and the move to lower-carbon transport.

The work will bring together industry experts and will be led by former Ford vice president Richard Parry-Jones.

Shriti Vadera said: "The UK's car industry is one of the most successful in the world, with a number of manufacturers currently enjoying record levels of production at their UK plants.

"But the industry, like many others, is facing a number of challenges as it moves into the next decade, particularly in terms of reducing emissions and tackling a continued rise in competition from low-cost countries such as China, India and Eastern Europe.

"We need to ensure our car industry can build on its existing strengths and remain competitive in an increasingly globalised world."

Mr Parry-Jones said: "New challenges, such as sustainable mobility solutions, and the emergence of strong auto markets and sectors in the East, provide powerful stimuli for change. I am looking forward to working with colleagues to define the challenges and suggest ways to enhance our ability to meet them through collaboration."

The investigation will also look at a new Departmental survey on the business environment for Japanese automotive supply companies in the UK, aimed at improving the UK's supply chain capabilities, including in areas such as management skills and the pace of new product delivery.

Shriti Vadera added: "A strong local supply chain is essential if we are to retain and increase vehicle manufacturers' investment in the UK.

"That is why we are already setting up a service to help match UK suppliers with car manufacturers, as well as establishing a new industry-led programme to help ensure supply chain managers have the right skills for the job."

Terms of Reference

* identify key performance indicators and success factors in support of the NAIGT

* investigate the barriers and challenges posed by existing EU and national legislation to ensure the UK has the right regulatory framework to encourage the competitiveness of a world class industry to continue to develop in the UK

* assess the evidence of the strengths, weaknesses and opportunities for each of the different sectors that make up the automotive industry together with identification of market trends (gaps and hotspots) using an evidence based approach

* review the impact of the previous AIGT and its legacy programmes and government interventions in support of the sector

* take account of the evidence and the implications of the King Review on low carbon cars; and the departmental report on the Business Environment for Japanese Automotive Supply Companies in the United Kingdom (April 2008)

* produce a report that makes recommendations to government that are capable of being taken into account in policy making, and to produce an action plan for industry.

Notes to Editors

1. Membership of the NAIGT is to be drawn from senior figures in the automotive industry, including vehicle manufacturing, supply industry and academia. Full details of the NAIGT membership will be announced shortly.

2. Richard Parry-Jones CBE was, until December 2007, the Group Vice President and Chief Technical Officer, Ford Motor Company. Richard is an elected member of the Royal Academy of Engineers and the Institution of Mechanical Engineers. Richard was awarded a CBE in The Queens New Year Honours List 2005 for services to the automobile industry.

3. The original AIGT 2002 Report

(http://www.berr.gov.uk/sectors/automotive/publications/page45523.html) was published by the Automotive Innovation and Growth Team in May 2002. The AIGT was chaired by Sir Ian Gibson CBE. This review gave rise to initiatives such as the National Supply Chain Groups Programme; the Low Carbon Vehicle Partnership; the Automotive Academy (now part of the National Skills Academy for Manufacturing); two centres of excellence - Cenex for Low Carbon and Fuel Cells Technologies and innovITS for Intelligent Transport System and Services.

4. Copies of the Report on the Business Environment for Japanese Automotive Supply Companies in the UK are available from http://www.berr.gov.uk/files/file45472.pdf or http://www.berr.gov.uk/sectors/automotive/index.html

5. The report was prepared by Toshi Sakamoto, a senior Director from Ministry of Economy, Trade and Industry (METI), Japan, who worked alongside the Automotive Unit in BERR who sponsored the project. The project was initiated in response to discussions between Ministers and representatives from the Japanese automotive industry in 2006. The report focuses on and analyses the findings of a survey of 41 Japanese auto-parts manufacturers and the three Japanese Vehicle Manufacturers with operations in the United Kingdom.

6. The Department for Business Enterprise and Regulatory Reform helps UK business succeed in an increasingly competitive world. It promotes business growth and a strong enterprise economy, leads the better regulation agenda and champions free and fair markets. It is the shareholder in a number of Government-owned assets and it works to secure, clean and competitively priced energy supplies