Some of the biggest car manufacturers in Europe have visited Downing Street to discuss the growing confidence in the UK automotive industry and the Government’s commitment to its success.

The Prime Minister hosted a meeting with the board of directors of the European Automobile Manufacturer’s Association (ACEA).

The ACEA then held their annual conference in London, the first time that they have met in the UK.

The ACEA represents some of the biggest car, truck and bus manufacturers at European level such as Fiat, Volvo, Renault, Jaguar Land Rover, Ford and Toyota.

Prime Minister David Cameron said: "I'm delighted that so many automobile manufacturers are actually bringing production and supply chain back to the UK.

"We want to do everything we can to encourage that by reducing our rates of corporate tax and setting up the regional growth fund, which is assisting a number of automotive companies.

"We are putting money into advanced manufacturing technology and innovation centres and expanding the number of apprenticeships.

"We really want to see the automotive industry flourish and we are determined to do the things to help it succeed."

Business Secretary Vince Cable said: “The conference in London shows the growing international recognition of our automotive industry and the interest in our national ambition to generate growth in the whole advanced manufacturing sector.

"Carmakers are boosting their investment in Britain. Nissan will design and develop the new Qashqai in the UK and BMW is building the new generation of Mini here as well as putting £500m into their UK manufacturing operations.

"These decisions show the strength and competitiveness of our automotive sector, the skills base that drives our economy and the ambition of the business community to secure long-term growth, which we are taking every available step to support."

The UK automotive sector

The automotive sector in the UK provides over 300,000 manufacturing jobs accounting for 12% of the UK's total manufacturing employment and a further 480,000 in the motor retail sector.

Automotive is the UK’s number one manufactured export – in 2010 the UK auto sector exported over £27 billion-worth of vehicles and parts. 75 per cent of cars, 73 per cent of commercial vehicles and 72% of UK engine production were exported in 2010. Automotive exports from the UK are almost at all-time high - approaching record pre-recession levels.

Over £1.5 billion was spent in the UK on automotive R&D in 2009 (the last year figures were available) - spending actually rose 9% during the recession, showing the industry’s commitment to long-term growth in this country. And we have world class design engineering expertise and development facilities, including those at Millbrook and MIRA, the world-leading automotive vehicle testing facility.

Paul Everitt, Society of Motor Manufacturers and Traders chief executive, said: “The UK motor industry is globally competitive and an engine for economic growth. New investments demonstrate the commitment of international investors, safeguard thousands of jobs and open up opportunities for companies at all levels of the supply chain.

“Industry and government must continue to strengthen our partnership to maintain and increase investment in vital areas of R&D, skills and capital equipment.”

Dieter Zetsche, president of ACEA and head of Daimler AG, said: “We acknowledge the positive approach taken by the UK government towards automotive innovation.

“It is first and foremost the responsibility of the automobile manufacturers to ensure competitiveness, and we pursue that goal head-on. But some issues are beyond our reach, whereas governments do play an important role.”

The main issues on the agenda of the talks included the need for:

  •  fair free trade with major economies such as India and Japan;
  • government support for the swift introduction of breakthrough technologies;
  • less bureaucracy through lean regulations.

Automotive sales are being mainly driven by growth in Brazil, Russia, India and China (BRIC) countries. In Europe, however, the situation remains tight.

Despite the continuing economic uncertainties, technological progress remains the stronghold of the European automobile industry, with investments of over €30 billion in R&D each year.

Zetsche said: “Our industry must and will further ensure that our products are world class. What we ask from governments is to ensure that the game is fair. It is our collective responsibility to make sure that Europe prospers for a long time to come.”