Could electric vehicle manufacturing provide a boost for Brexit Britain?

31 August 2017

With the UK leaving the European Union by 2019, there are many questions over how the automotive industry will cope, especially if, as expected, the country also leaves the single market. This would mean tariffs will be imposed on both imports and exports, potentially increasing the cost of manufacturing.

However, the country is looking to make itself a centre of excellence for the development of both electric and autonomous vehicles, and with the introduction of a ban on the sale of new petrol and diesel only powered cars from 2040, manufacturers have the opportunity to begin developing cars for a market that is going to rely on them soon, especially if consumers begin to ditch their internal combustion engines in preparation within the next ten years.

There are already signs that the electric vehicle (EV) revolution could bring more business to the UK despite concerns over Brexit. In November 2016, Jaguar Land Rover announced its intentions to build a range of EVs in a new facility located at its West Midlands plant. This expansion could create around 10,000 jobs and would help the company double the number of vehicles it produces to one million a year. However, this guarantee was on the back of the need for a commitment by the UK Government to improve power supplies for EVs, as well as investment in mobile networks so the company could continue to develop its autonomous vehicle plans. Since then, JLR and the government have announced plans for the establishment of the core UK hub for EV battery production and development, signalling that conditions have been met.

Meanwhile, BMW has announced that the electric version of the Mini will be built at the Cowley plant in Oxford. The German manufacturer has chosen the UK plant over one in Poland in order to keep the expertise of assemblers in the country, while retaining a British aspect for the brand. It will ship drivetrains into the UK for integration at the plant, all of which will incur import tariffs. BMW’s higher margins make these costs easier to absorb than for volume brands.

Preparing for an electric future was also expected to hit niche manufacturers, of which there are plenty in the UK. However, a vocal opponent of the government’s ban plans, Aston Martin, has recently announced that it too will go all-electric, with all its vehicles featuring hybrid or fully electric technology by 2025.

The pledge is similar to that of Volvo, which announced that by 2019 it would stop offering vehicles with a traditional internal combustion engine for sale. The British marque believes that by 2030, 25% of its line-up will be electric and the rest hybrid. Aston Martin’s first EV, the Rapid-E, is due for launch in 2019.

The company will keep its hybrid and electric development in-house, meaning all the research and building of systems will remain in the UK. CEO Andy Palmer comments: ′You need to keep core technology inside the company, that’s why we make our own V12 engine. We believe that EVs are a core technology, and therefore we want to do them ourselves.’

With manufacturers either relying on government assurances to stay in the UK post Brexit, or looking at potentially moving production of vehicles to mainland Europe in order to save costs, the investment in EV technology, together with the skills it will bring the country’s automotive workforce, could help Britain retain vehicle manufacturing as the automotive industry looks to embrace a low and zero emission future.