Driven along the road to nowhere
Published by The i paper (18th November, 2019)
No doubt to erase memories of previous scepticism on man-made climate change, the Prime Minister gave his first big speech of the election campaign at an electric-car plant in Coventry. It was a typical Boris Johnson performance, filled with bluster, boasts and bombast, even if an infantile line about masturbation was removed after leaks to the media.
He proclaimed a grandiose vision for unleashing the country’s potential, with a pledge to spend millions ensuring no driver would be left more than 30 miles from an charging point. The message was clear: here was a dynamic politician bursting with energy, progressive yet in touch with popular concerns. So how unfortunate that the technology titan Elon Musk, chief executive of Tesla, chose the previous night to announce Berlin would become the site of its first major European factory. ‘Berlin rocks,’ he said.
So much for hopes this huge investment would come to our country. In a second blow, the car-maker is also establishing its engineering and design centre in the German capital, despite Musk’s previous desire to build the base in Britain. ‘Brexit made it too risky to put a Gigafactory in the UK,’ he told a motoring magazine.
This was a significant moment, cutting like a sharp knife through Johnson’s splutter. Musk may be a controversial character, but he is also a bold innovator whose firm makes the world’s best-selling electric car. He intends Tesla to be a key player in a fast-evolving motor industry that will be cleaner environmentally and filled with self-driving vehicles, as smart technology replaces humans behind the wheel. But due to the impact and uncertainties of Brexit, the Model 3 and Model Y vehicles will not be rolling off British production lines and creating jobs for 10,000 British workers.
This underlines how our decision to depart the world’s biggest trading block will hurt. Not with sudden shocks – so long as the disaster of ‘no deal’ can be averted – but with a multitude of investment decisions made in global boardrooms that cause incremental damage to the economy. This will be a myriad of missed opportunities, decline by a thousand cuts, often unseen and imperceptible until a bigger picture of sluggish performance slowly emerges.
Yet what gives Musk’s decision extra potency is how the car industry, arguably more than any other sector, has come to symbolise Britain’s rollercoaster fortunes in recent decades.
Think back to the swinging 1960s with those sleek E-type Jaguars and pictures of Twiggy posing with a Mini. In the next decade the strife-torn industry mirrored national decline, shackled by strikes with dismal management in a stagnating economy. In the mid-80s Margaret Thatcher lobbied Nissan to build its plant in Sunderland, seeing the firm’s faith in a region scarred by industrial collapse as a crucial step in her determination to reshape the economy. She sold the idea that Britain was an unfettered gateway to Europe – and the Japanese giant was followed by car-makers from Germany, India and the United States.
These automotive behemoths blazed a trail that demonstrated both the benefits of globalisation and strength of an open society with the confidence to welcome foreign firms, finance and people. Britain became the base this century for more motor manufacturers than any other country on the European continent, as well as home to a majority of Formula One teams in a dynamic cluster of technological innovation. More than 800,000 British jobs rely on this export-led industry that so skilfully exploited our position in Europe, adding £20bn annually to our economy.
Now look at this nervous sector. Nearly 10,000 jobs have gone already, investment has plummeted and the number of vehicles rolling off production lines fallen for 15 of the past 16 months. Nissan has reversed plans to make its seven-seater X-Trail SUV at that iconic Sunderland plant, shifting production to Japan and saying Brexit changed investment decisions. Honda announced it will shut its factory in Swindon with the loss of 3,500 jobs. The German parts supplier Schaeffler is closing two plants, blaming ‘uncertainty over Brexit’ and exposing the wider problems of this slowdown.
James Bond may still be driving an Aston Martin in his next cinematic outing – and an electric one this time – but this luxury marque so strongly associated with our national brand is in dire straits. After floating just over a year ago, its shares have crashed to a fraction of launch price amid ‘continuing macro uncertainties’, with spiralling costs, slumping sales and hefty losses. The big question is whether 007 is strong enough to pull the 106-year-old firm out of its dangerous spin.
These problems cannot be blamed just on Brexit. Motoring firms are being battered by wider problems as global sales shrink, trade wars erupt, environmental concerns escalate, diesel falls out of fashion and technology giants circle like vultures. But Brexit definitely fuels the fire for the country’s 33 manufacturing plants that rely on just-in-time deliveries and a complex web of supply chains requiring 25 million parts a day – especially after spending £500m preparing for no deal, and with shutdowns lasting up to a month on supposed departure days. Tariffs could cost £4.5bn a year.
Big choices face our country in next month’s election – and lurking behind them lies Brexit. Here is a stalling sector that for all Johnson’s hyperbole shows the unhappy reality behind his breezy campaign talk of national renewal and his contempt for business. The PM used to review cars for a magazine, so should know that the motor industry reflects our ups and downs with uncanny accuracy. Yet he drives on recklessly, ignoring warning signs as he steers us from the global fast lane on to the meandering post-Brexit B-roads, while the likes of Tesla speed past to other places.