英国汽车协会-零排放竞赛：为英国电动汽车供应链提供动力（英）-2023.3-12正式版

RACETOZERO:POWERINGUPBRITAIN’SEVSUPPLYCHAINHHLiMarch2023每日免费获取报告1、每日微信群内分享7+最新重磅报告；2、每日分享当日华尔街日报、金融时报；3、每周分享经济学人4、行研报告均为公开版，权利归原作者所有，起点财经仅分发做内部学习。扫一扫二维码关注公号回复：研究报告加入“起点财经”微信群。。Britainhasauniqueautomotiveoffering–oneoftheworld’smostdiverseandvariedvehicleproductionsectors,withastableofillustriousbrands,anoutstandingrecordinR&D,andasupplychainthatcombinesinnovationwithqualityandflexibility.Todate,thatsuccesshasbeenbuiltprimarilyontheinternalcombustionengine.Overthenextdecadeorso,thatexpertisewillreduceinimportance.TheUKwillendthesaleofnewpurepetrolanddieselcarsandvansin2030.TheEU,ourlargestexportmarket,willdothesameby2035.NewHGVswillbezeroemissionby2040.Othermarketswillfollow.Thetransformationofourindustrywillbewholesale,rapid–andhighlycompetitive.TheUKisalreadyasignificantproducerofbatteryelectricandelectrifiedvehicles,manufacturingzeroemissioncars,vans,busesandtrucks.UnderpinningvehicleproductionacrosstheUKisanequallydiversesupplychain,onewhichmustalsomaketheswitch.Butthattransitionneedsinvestmentandforthatwemustbecompetitive,buildonourstrengthsandmatchthebesttheworldhastooffer.Wecannotignorethefactthatothercountriesandblocsarepoweringuptheirpoliticalandeconomicbackingfortheirownautomotivesectors.TheUShasannounceda$2trillionpackageofmeasuresinpursuitofcleantechnology,includingitsflagship$370billionInflationReductionAct.TheEUisproposingaGreenDealIndustrialPlan,easingrestrictionsonStateAidfortheseessentialinvestments.Othercountries,especiallythoseinAsia-Pacific,forinstance,alreadyhaveaheadstartinbatteryproduction.

WecannotlettheUKfallbehind.BritainhasafoundationalEVsupplychain,onewhichhasbeenmappedforthefirsttimeinSMMT’snewEVSupplyChainDirectory,alsopublishedtoday.Thisshowsthatwealreadyproducealmosteverycomponentrequiredtomanufacturezeroemissionvehiclesinsomecapacity:batteries,powerelectronics,hydrogenfuelcells,everythingfromanodestographenetosiliconcarbidewafers,arealreadymadehere.SowehavethebaseelementsofasuccessfulEVtransition,aswellasembeddedstrengthssuchassignificantrenewableenergyprovision,aflexibleandskilledworkforceandworld-leadingR&D.Thesekeyadvantagesprovideanopportunitytomatchambitionsforthemarketwithambitionsforproduction.Butwemustbuildonthisearlycapability.Wemustscaleupanddosorapidly.Thismeanscreatingtheconditionstoretainandattractinvestment,captureearlierandgreaterUK-basedvalueinbatteryproduction,drivetherapidgrowthoftheelectrifiedsupplychainandsecurethetradeagreementsthatguaranteethesupplyofmineralsandtheopennessofmarkets.Thisrequiresagovernment-ledstrategyandactiondeliveredatpace.ThisdocumentexploresthegreatachievementsandpotentialwithinourzeroemissionsupplychainandsetsoutablueprintforaGreenAutomotiveTransition(GreAT)strategytoanchorfuturevehicleproductionintheUK.Britainisagloballeaderinthedecarbonisationofthevehiclemarket.Butouraspirationmustbebroader.Wemustalsobealeaderinzeroemissionvehicleproduction,supportedbyaworldclasssupplychainthatactsasaworkshopfornewtechnologiesdeliveredbyaUKindustrytoaglobalmarket.MikeHawes,ChiefExecutiveTheSocietyofMotorManufacturersandTraders(SMMT)

INTRODUCTIONCONTENTS:02 ForewordPart1:GreatStrengthsAFirmFoundationAFuture-facingNationPart2:AGreATStrategyDe-riskPrivateCapitalReformRegulationGlobalDiplomacy11 Conclusion2 THESOCIETYOFMOTORMANUFACTURERSANDTRADERSEVSUPPLYCHAINWORKSHOPFORTHEWORLDTHEUKEVSUPPLYCHAINEverypartoftheUKcontributestoelectrifiedvehicleproduction,eitherthroughfinishedvehiclemanufacturingorsupplyofkeycomponents.SCOTLANDBattery Powersystems electronicslCellcomponents lSemiconductorslCellslRawmaterialslRefurb,re-useandrecyclingNORTHWESTBatteryElectrifiedsystemspowertrainlBatterylElectricdriveunitcomponentslPowertrainlBatterydesigndevelopmentanddevelopmentlBatterypackNORTHERNIRELANDassemblyPowerlCellselectronicslRawmaterialslInverterslRefurb,re-useandrecyclingHydrogenlFuelcellcomponentsWALESBatteryElectrifiedWESTMIDLANDSsystemspowertrainlBatterylElectricdrivecomponentsunitlBatterytestinglCellsRefurb,re-useandrecyclingBatteryElectrifiedsystemspowertrainlBatterylElectricdriveunitcomponentslFullpowertrainlBatterylPowertraindevelopmentdesignlBatterypackanddevelopmentassemblylBatterytestingPowerlCellcomponentselectronicslCellslComponentlRawmaterialsdesignSOUTHWESTlRefurb,re-uselPowerandrecyclingelectronicsHydrogenassemblyBatteryElectrifiedlWiringharnessessystemspowertrainlFuelcellslBatterylFullpowertraincomponentslRawmaterialsBritainhasatrulyuniqueautomotiveHydrogenlFuelcelloffering–oneoftheworld'smostdiverseandvariedvehicleproductionsectors,anoutstandingrecordinR&DandasupplychainthatprovidespartsandcomponentsusedtomanufacturenewvehiclesEASTMIDLANDSBatteryElectrifiedsystemspowertrainlBatterytestinglElectricdriveunitlCellcomponentslFullpowertrainlRawmaterialslPowertrainlRefurb,re-usedesignanddevelopmentandrecyclingHydrogenPowerlHydrogenelectronicsstoragelSemiconductors

KEY:ELECTRIFIEDVEHICLEPRODUCTIONCar Van Truck BusNORTHEASTBatteryElectrifiedsystemspowertrainlBatterylElectricdriveunitcomponentslPowertrainlBatterydesignanddevelopmentdevelopmentlBatterypackassemblyPowerlCellselectronicslRawmaterialslPowerelectronicslSemiconductorsYORKSHIREANDTHEHUMBERBatteryElectrifiedsystemspowertrainlBatterylElectricdriveunitcomponentslHybridlCellstransmissionsRawmaterialsRefurb,re-useandrecyclingEASTOFENGLANDBatteryElectrifiedsystemspowertrainlBatterytestinglElectricdriveunitlCellcomponentslFullpowertrainlRawmaterialslPowertrainLONDONlRefurb,re-usedesignanddevelopmentandrecyclingANDTHESOUTHEASTHydrogenPowerlHydrogenelectronicsstoragelSemiconductorsBatteryElectrifiedsystemspowertrainlBatterylElectricdriveunitcomponentslE-motorlBatterycomponentsdevelopmentlFullpowertrainlBatterypacklPowertrainassemblydesignandlBatterytestingdevelopmentCellcomponentsCellsRawmaterialsHydrogenPowerlInverterselectronicslFuelcellslControlelectronicandsoftwarelPowerelectronicsassembly3 THESOCIETYOFMOTORMANUFACTURERSANDTRADERS01GREATSTRENGTHSAFIRMFOUNDATIONEVproductionanditsassociatedsupplychainare

TheUKalreadyhasanestablishedglobalreputationasanautomotiveproductionpowerhouse.Morethan70vehiclemodelsarebuiltinBritainbymorethan25manufacturingbrandsandelectrifiedvehiclescomprisealmostathirdofallcarproduction.TheUKisalsohometoelectrifiedvan,busandtruckproduction,bylongestablishedbrandsandnewchallengers.TheelectricvehiclesupplychainisanimportantcontributortotheUKeconomy.EverypartoftheUKisinvolvedinelectricvehicleorcomponentmanufacturing,withtheEVsupplychaingrowingbymorethan25%inthepastfiveyears.Asaresult,EVproductionanditsassociatedsupplychainareessentiallynationalcriticalassets.FinishedvehiclesareamongBritain’smostvaluableexports,deliveringrevenueof£24billionin2022,ofwhich£10billionwasforelectrifiedvehicles.1

derailambition.Furthermore,whilemuchfocushas(importantly)beenplacedonfinishedvehicleandbatteryproduction,thereisawealthoffurtheropportunityforsupplyofotheressentialEVcomponentssuchaspowertrains,fuelcellsandpowerelectronics.TheUKautomotivesupplychaincurrentlyemploysaround123,500people,withmorethan2,500automotive-specificcompaniesandtotalturnoverof£21.2billion.2ThisunderpinstheUK’scurrentvehicleandengineproduction,demonstratingthevasteconomicopportunityavailablebeyondheadlineautomotivemanufacturing.Thefledglingsectorisgrowingrapidly,itisbroad,diverseandcapable,withhugepotential–andtheUKbenefitsfromspecificadvantagesinhelpingittogrow.First,BritainalreadyhasanestablishedandgrowingEVsupplychain,whichhasbeenmappedforthefirsttimeinSMMT’sEVSupplyChainDirectory.Morethan180companiesareinvolved

STRENGTHSUKelectrifiedcarproductionasproportionofoverallUKproduction,2017-2022ElectricHybridSource:SMMTdata%20172018201920202021202240200essentiallynationalcriticalassets

AfullmanufacturingtransitionwillneedtheUKtoincreaseitsgigafactorycapacity,whichislimitedatpresenttoonefacilitywithanoutputof2GWh.However,thisisexpectedtoincreaseto11GWhby2025andfurtherprojectshavebeenoutlinedthatwouldaddanother60GWhiftherightconditionsaremet.WhiletheUKhaslostonepotentialgigafactoryproject,thisdoesnot

inproducingcomponentsforelectricvehicles–asmall,butimportantandgrowingproportionofthetotalautomotivesupplychain.Asaresult,theUKalreadyproducesmostmajorcomponentsandassembliesrequiredtomanufactureanelectricvehicle’spowertrain–batterypacks,e-machinesandpowerelectronics–aswellasfuelcellsforhydrogenvehicles.Thesecompanies

aredistributedthroughoutBritain,meaningelectricvehicleproductionanditssupplychainisalreadycreatingjobsacrossthecountry,withhugeopportunityforgrowth.EstimatesfromtheAdvancedPropulsionCentre(APC)suggestthereisa£24billionopportunityfortheEVsupplychain,whichcanbedeliveredwiththerightindustrialstrategy.

Third,theUKcanbenefitfromnewexportopportunities.TheEU-UKTradeandCooperationAgreement(TCA)enablestariff-free,quota-freetradewiththeEUwhilealsoprovidingtheUKscopetonegotiatenewtradedealswithothernations.However,wemustensurethesedealsareappropriateforthetechnologiesoftodayandtomorrow.TheTCA,forexample,includesprovisionsthatwilltightenrulesoforiginforTheUKalreadyproducesmostmajorcomponentsandassembliesrequiredtomanufactureanelectricvehicle’spowertrain4 THESOCIETYOFMOTORMANUFACTURERSANDTRADERS

Second,Britainisamongtheworld’sleadingautomotivemanufacturingcountriesforproductivity,withhighlabourflexibility.Furthermore,whileothernationshaveacceleratedtheirproductiontransition,theUKishometoEurope’sfirstmassproducedelectriccar,andby2025atleast20modelsofbatteryelectric(BEV)orplug-inhybrid(PHEV)carsandvansareexpectedtobeinproduction–inadditiontobusesandtrucks.

electricvehiclesin2024and2027.InvestinginUKsuppliers,therefore,willbevitaltoensurethatBritish-builtEVscancontinuetomeettherequiredthresholdstoexporttariff-freetoourlargestsingletradepartnerandtherestoftheworld.BasedonHMRCdataSMMT,FullChargetoFullThrottleSTRENGTHSFUTUREFACINGNATIONTheUKhasmajorpotentialforlowcarbonmanufacturingofEVs

OntopoftheUK’sexistingfoundationsforEVproductionandsupplychainarestrongcommitmentstofutureinnovationandanenergylandscapedesignedtohelpdeliveranetzerofuture.GREENENERGYFORAGREENSUPPLYCHAINForthezeroemissiontransitiontotrulydeliverfortheeconomyandtheenvironment,itisvitalthatitisfuelledbylow-orzero-carbonenergy.Otherwise,theswitchtoelectricandhydrogenvehicleswouldsimplymoveemissions,ratherthaneliminatethem.TheUK’senergymixprovidesanopportunitytobealow-carbonhubforEVproductionandtheEVsupplychain.Asof2022,Britain’ssecondlargestsourceofenergywaswindpowerand,overall,almostathirdofallelectricityusedintheUKcamefromrenewables.3By2026,morethanhalfofallUKelectricityisforecasttoberenewablygenerated,whilegovernmenthassetatargetthat100%ofallelectricitybezeroemissionsourcedby2035.Oftheworld’stop20automotiveproducingcountries,theUKcurrentlyranksasseventhbestforlowcarbonenergygeneration,with269gofCO2emittedperkilowatthourgenerated.4Asof2021,theUK’senergygenerationemissionswere-17%lowerthantheEUaverage.Whilesomemajormarketshavelowerenergyemissions(notablyFranceandSlovakia),othermajorEVmanufacturingnationshavefarmorecarbon-intenseelectricity–Germany’semissionsare31.3%higherthantheUK’s,whiletheUS’are40.7%higher,SouthKorea’sare69.8%higherandChina’s101.8%higher.Asaresult,theUKhasmajorpotentialforlowcarbonmanufacturingofEVsandkeyEV-specificcomponents,eitherviacompleteproductiondomesticallyorthroughsupplyofBritish-builtbatteriesande-motorsformanufacturingoverseas.

CurrentUKenergygridmix2022%38.5%Gas4.4%Solar26.8%Wind1.8%Hydro15.5%Nuclear1.5%Coal5.5%Imports0.9%Energystorage(mixedsource)5.2%BiomassTheFaradayInstitutionestimatesthatby2025aUK-producedbatterywouldhave12%lessembeddedCO2frommanufacturingthantheEuropeanaverage,whiletherewouldalsobereductionsinembeddedcarbonforotherkeypowertraincomponentsproducedinBritain,alongwithhydrogengenerationandfuelcellproduction.5Thisthenproducesapotentialcompetitiveadvantage,wheretheUKcanbepositionedasaplacewheregreenenergyisusedtoproducegreenbatteriesandpowertrains,whichthenpowergreenvehicles.NationalGridESO:Britain’sElectricityExplained:2022ReviewOurWorldInData:globalenergymixFaradayInstitution:TheUK:ALowCarbonLocationtoManufacture,DriveandRecycleElectricVehicles

Carbonintensityofelectricity(gCO2/kWh)2021FranceSlovakiaCanadaBrazilSpainItalyUKGermanyRussiaUnitedStatesMexicoCzechRepublicTurkeySouthKoreaJapanIranThailandChinaIndia70060050040030020010005 THESOCIETYOFMOTORMANUFACTURERSANDTRADERSFOCUSEDONRESEARCHANDDEVELOPMENTTheUKishighlyfocusedonresearchanddevelopmentofnewtechnology,withtheautomotivesectorhavingaparticularlystrongtrackrecordinthisfield.Around11%ofUKbusinessresearchanddevelopmentismadebytheautomotivesector,whichboasts22dedicatedR&Dcentresacrossthecountry.6ThisistestamenttothestrengthofrelationshipsbetweenacademiaandindustryinBritain.TheAutomotiveCouncil’sUKInternationalCompetitiveness(UKIC)surveyin2022foundthatofallthefactorsthatinfluenceinvestmentdecisions,university-industrycollaborationwasratedastheUK’sbiggeststrength.BritainisalsoratedmorehighlythanthemajorityofEUnationsonuniversity-industryR&D,andaboveaverageglobally.ThisiscomplementedbytheUK’suniquemotorsportpedigree,whichdrivescompetitiveand‘challenge-led’engineering,helpingtospurinnovationacrosstheentiresector.Theindustryitselfinvestsaround£3billionayearinR&D,andbenefitsfromtheAutomotiveTransformationFund(ATF),administeredbytheAPC.Sofar,theATFisexpectedtodeliver£1billionininvestmentinzeroemissionautomotiveproductionandsupplychaindevelopment,creatingorsafeguardingapproximately50,000jobs.Inaddition,upto2025,governmentwillfund£211millionworthofbatteryresearchandinnovation,whichisexpectedtodeliver100,000jobsinthesupplychainby2040.Indeed,theUKhasarobustglobalreputationforsupportingR&Dbysmallercompanies,rankedsixthbestforgovernmentincentivesforresearchoutofthe21nationsevaluated.7SMMT:FullThrottletoFullChargeAutomotiveCouncilUK:UKAutomotiveInternationalCompetitiveness–ThirdEdition

University-IndustryCollaborationRatings:GlobalInnovationIndexscoreUSANetherlandsChinaGermanyCanadaUKSouthKoreaJapanIndonesiaFranceThailandCzechRepublicSouthAfricaItalyHungaryRussiaTurkeyIndiaSpainBrazilMexicoPolandRomaniaSlovakiaMorocco8070605040302010Around11%ofUKbusinessresearchanddevelopmentismadebytheautomotivesector

STRENGTHSR&DLOCATIONSSOUTHEASTANDLONDON–AVLPowertrainUK–DigitalEngineering&TestCentre(DETC)–FordDuntonTechnicalCentre–ShorehamTechnicalCentre–UniversityOfBrighton(APCICEThermalEfficiencySpoke)WESTMIDLANDS–ChanganUKR&DCentre–LotusTechCreativeCentre–TheManufacturingTechnologyCentre(MTC)–HORIBAMIRA–TheNationalAutomotiveInnovationCentre(NAIC)–REEEngineeringCentre–SAICMotorUKTechnicalCentre–TataMotorsEuropeanTechnicalCentre–WMGWarwick(APCElectricalEnergyStorageSpoke)EASTOFENGLAND–CranfieldUniversity–HethelEngineeringCentre–MillbrookProvingGround–NissanTechnicalCentreEuropeNORTHEAST–NewcastleUniversity(APCElectricMachinesSpoke)SOUTHWEST–UniversityofBath(APCICESystemsEfficiencySpoke)EASTMIDLANDS–UniversityofNottingham(EPSRCCentrePowerElectronics;APCPowerElectronicsSpoke)–VestatecAutomotiveEngineering6 THESOCIETYOFMOTORMANUFACTURERSANDTRADERS02AGREENAUTOMOTIVETRANSFORMATION(GREAT)STRATEGYUKelectricandhybridvehicleexportstotalled£10billionin2022

TheUKautomotiveindustryhassignificantcapabilitiesindrivingthemissiontodecarboniseroadtransport.WithalmostathirdofallUK-manufacturedcarslastyeareitherfullyelectricorhybridwithanexportvalueof£10billion,itsstrongfundamentalsareclear.Ourfoundationsinadvancedmanufacturing,engineeringandR&Daresolid,buoyedbydecadesofinwardinvestment.Ouringenuityanddrivetocontinuouslyinnovateareunderpinnedbyaskilled,flexibleandhighlyproductiveworkforce.Weneedanationalindustrialvisionforgreengrowthand,specificallyfortheautomotiveindustry,adedicatedandcomprehensivetransformationstrategytoactivelyandvisiblypositionanddelivertheUKasoneoftheworld’smostcompetitivelocationsforadvancedautomotivemanufacturing.Thestrategyshouldbeambitiousandpragmatic,focusingonstrategicgovernmentorchestrationwithactivedeliveryatpace.Itisnotareturntothedarkdaysofprotectionism,butlookingtoabrighter,greenerfuturethroughthelensofrealism.Assuch,thestrategymusthavearelentlessandrazor-sharpfocusonenhancingcompetitivenessandstimulatinggrowth,whicharecriticalfactorsinattractinginvestmentandlevellingtheplayingfieldforUKAutomotive.AlmostathirdofallUK-manufacturedcarslastyearwerefullyelectricorhybrid

STRATEGYAGREENAUTOMOTIVETRANSFORMATIONSTRATEGYDE-RISKPRIVATECAPITALREGULATORYREFORMGLOBALDIPLOMACYMoregenerousincentivesUpdateoutdatedregulationExpandandenhanceandsubsidiesandplanningrequirementsfreetradeagreementstobeappropriatefortheelectricvehicleageCompetitiveenergycosts Reduceredtapeandfast- Partnerwithmineral-richtrackapprovalsforbattery nationsproductionandrenewableenergyprojectsSupportrenewable Speedupgreentechnology PromoteBritishinvestmentenergyprojects projectfunding incriticalmaterialminingSupportclean-techstart-upsDecoupleelectricitypricesProvidebestpossibletradeandscale-upsandrenewablesconditionsforremanufacturingfromgasGreentechco-investmentUpskilltheworkforce7 THESOCIETYOFMOTORMANUFACTURERSANDTRADERSDE-RISKPRIVATECAPITALGlobalinvestorsarecognisantofthestrengthsandcapabilitiesofUKAutomotive

TheRacetoZeroisglobal,andtheUKmustbeequippedwiththerightbusinessframework,incentivesandsubsidiestopromoteinvestmentinzeroemissiontechnologyresearch,developmentandproduction.TheUKcurrentlyhasstructuraldisadvantageswhencompetingwithmajorEuropeancountries,whichoffercashincentives,taxbreaksandinvestmentinlandandinfrastructure.MissionZero–RtHonChrisSkidmore’sindependentNetZeroreview–outlinesseveralpotentialrecommendations,includingbackingbusinessesbyreviewingincentivesforinvestmentingreentechnologies.Givenstringentlocalcontentrequirementsunderfreetradeagreements,significantinvestmentindomesticmineralsrefining,cathodeandanodeactivematerials,batterycomponentandcellmanufacturing,andelectricdriveunitsiscrucialtoensurewecanbenefitfromandmaximisetariff-freetrade,includingwiththeEU,whichwillcontinuetobetheUK’smostsignificantautomotivetradingpartner.Calculatedrisk-takingisfundamentaltothegrowthofenterpriseandeconomies.GlobalinvestorsarecognisantofthestrengthsandcapabilitiesofUKAutomotivebutmusthaveconfidencetoselecttheUKoveralternativelocations.Thiscallsforabold,internationallycompetitivepro-growthpackageofincentivesandsubsidies,smartlydeliveredtode-riskinternationalcapitalandpositiontheUKasthelocationofchoiceforgreentechnologyinvestment.ThisdomesticstrategymustbealignedtoacomplementaryinternationaltradestrategythatensurestraderulesforEVsandbatteriesarefitforpurposesothattheUKisaglobalmanufacturingdestinationofchoice.

APLANFORDE-RISKINGINVESTMENTMoregenerousnear-to-mediumtermincentivesandsubsidiesmoreaccessibletobusinessanddeployedatpace,includinggrantsandtaxbreakstoencouragethelocalisationandscalingofabatteryvaluechainandpromoteacirculareconomy.Fundingshouldbeprioritisedforhigh-valueorstrategicactivitiessuchasmineralsprocessing,cellmanufacturing,batteryreuseandremanufacturing,materialsrecoveryandrecycling,electricdriveunitmanufacturingandfuelcellproduction.Significantsupportinthenear-termtoensureourenergycostsarecompetitive.Automotive,widelyrecognisedasexport-ledandtradeintensive,shouldbeaffordedequivalentbenefitsasanenergy-intensiveindustry(EII)allowedtoclaimfromtheEIIExemptionScheme,orbeabeneficiaryoftheBritishIndustrySuperchargerscheme.GivenUKelectricitypricesarecurrentlymorethandoubletheaveragepaidatEUvehicleplants,theavailabilityoflowcost,lowcarbonenergycouldbeahugeinfluencerininvestmentdecisions,especiallyformoreelectricity-intensiveelectricvehiclesandtheirassociatedsupplychains.Greaterincentivisationofrenewableenergyprojectstoensuremedium-to-longertermenergysecurity.WhiletheUKisstillaworldleaderinoffshorewind,theincreaseinoverallrenewableenergycapacityhasbeensluggish,withonly6.9%ofnewcapacityaddedinthe12monthstoSeptember2022.Thiscallsforadoublingdownofincentivesandsubsidiestodrivetherapidscalingofrenewableenergygenerationandstoragerequired.

STRATEGYBetteraccesstoinnovationgrantsandsubsidiestosupportclean-techstart-upswithinnovativesolutions.ThepathtocreatingthenextBritishunicornsbeginswithnurturingandsupportinglessmature,experimentaltechnologies,especiallythoseinbatterychemistries,renewableenergygenerationandstorage,andcarboncaptureandstorage.GovernmentshouldatleastmatchtheEU’sintentiontofundupto45%ofthetotalprojectcostsoftheseinitiatives,anddevelopaclearpathwaytoscaleupsuccessfulR&DthatkeepsprosperityandopportunityintheUK.Creationofaspecialpurposevehicle(SPV)toenablegovernmenttoco-investingreentechnologiesinthemedium-to-longerterm.SimilartotheEuropeanSovereigntyFundandSingaporeangovernmentinvestmentvehicles,anspecialpurposevehiclethattakesaminoritystakeincarefullyidentifiedventureswillallowhigh-potentialbusinesseswithproventechnologiestorapidlyscale.Oncetheybecomemoreattractivetoprivateinvestors,governmentcanexitforaprofitthatisthenreinvested,hencecreatingavirtuouscircleofgrowth.Continuetochampionthedeliveryofthe2023AutomotiveUpskillingPilotProjectinthemajorautomotiveregionsandsupporttotransitionthePilotProjectintoalong-termNationalSkillsPlatform,withcentralisedgovernancestructuresandtrusted,government-backedbrandingestablished.Short-coursequalificationsshouldbequalityassuredandOccupationalMapsestablishedtoprovideemployeesandtheiremployerwithatrainingroadmap,equivalenttowhatisavailableforapprentices.8 THESOCIETYOFMOTORMANUFACTURERSANDTRADERSSTRATEGYREGULATORYREFORMSTheUKneedsaregulatoryframeworkthatissuitedforsimplifiedandfast-trackgreentechnologyprojectpermissionsandfundingapprovals

Anindustrialtransformationstrategymustbeambitiouslyfundedanddeliveredatspeed.TheUKneedsaregulatoryframeworkthatissuitedforsimplifiedandfast-trackgreentechnologyprojectpermissionsandfundingapprovals.Thecurrentprocessforsecuringpermitsandfundsto,forexample,buildabatteryproductionorrefiningfacilityisonerouslyprotracted,whilecurrentlyitcouldtakelongertopermitawindfarmthantobuildit.Reformwillenableindustryandconsumerstobenefitfromthelowercostsandincreasedavailabilityofrenewables.

Wemustnotletourworld-leadingambitionsonzeroemissionvehiclesandrenewableenergybederailedbycumbersomeandoutdatedplanningandpermittingpolicies.Webelievethefollowingmeasuresarenecessary:Simplifyredtapeorfast-trackwhereappropriateapprovalprocessesforcapitalprojectssuchasbatteryproductionormaterialsrefiningfacilities,onshoreandoffshorewindfarms,solarfarms,energystorage,electrolysers,andcarboncaptureandstorage.GovernmentshouldconsideradaptingtheapproachinSpain,wherethegovernmentautomaticallygrantspermitstosub-150MWsolarphotovoltaicprojectsandsub-75MWwindfarmsthatmeetspecifictechnicalcriteriaiftherearenoobjectionstotheapplicationwithintwomonths.Suchanapproachcouldhalvethedevelopmenttimeforsolarprojectswithoutcompromising