Spending review assessed: what it means for automotive
The automotive industry has responded to the government’s spending review, which offered support for electric vehicles, apprenticeships, and road infrastructure.
Chancellor Rachel Reeves announced £1.4bn to drive EV uptake and a further £1.2bn to support apprenticeships and upskilling.
A further £24bn of capital funding has been announced to ‘maintain and improve’ the UK’s road network.
However, some industry experts have expressed concern about a lack of clarity around how the additional funds will be spent, and called for further details to instil industry and consumer confidence.
SMMT
Mike Hawes, SMMT chief executive, said: “The automotive industry recognises the pressure on the public purse and the need to divert funding to defence and growth. Automotive can deliver that growth but it depends on both competitive conditions and consumer confidence.
“Some support for EVs has been made available, but more substantive measures to incentivise private consumer demand are still needed if world leading targets are to be met.
“Government has already made great efforts to support a critical industry facing significant geopolitical challenges but without market-making interventions, that world-leading pace of transition may need to be reviewed.”
The AA
Jack Cousens, head of roads policy for The AA, said: “The spending review offers a pathway to improved mobility by road, including £24bn for the improvement of motorways and A roads. That offers some hope to those drivers stuck daily in traffic jams on the M25 and motorways around Manchester.
“Investment in EV charging will spur more businesses and travellers who rely on their cars to convert to electric vehicles. However, more needs to be done to help people switch such as equalising VAT on out-of-home charging and discounting VED rates. We hope the Chancellor makes these changes as soon as possible.
“The boost to policing is also very welcome, particularly if it means more cops in cars. One of the biggest deterrents to some of the rampant bad behaviour on roads is the perception that being caught by the police is a very real prospect. Similarly, a key way to reduce insurance premiums to is to cut vehicle theft – something more traffic officers could achieve.”
NFDA
Sue Robinson, National Franchised Dealers Association CEO, said: “The government’s Spending Review sets a crucial tone for the coming years and while it is welcome to see investment directed toward infrastructure, skills and EVs, Chancellor Rachel Reeves MP’s review, similar to the Spring Statement, has left some issues in the dark.
“Firstly, the £15.6bn transport package and renewed focus on regional connectivity are positive signals for dealer networks and supply chains across the North and Midlands. Efficient transport infrastructure supports business mobility/customer access and ultimately boosts confidence across local economies where many of our members operate.
“The government has briefly addressed electric vehicles (EVs) and decarbonisation. NFDA acknowledges this investment for EVs, however the government needs to clarify how this £1.4bn will be spent and we still remain of the view that the government needs to be incentivising consumers to purchase a new vehicle by improving charging infrastructure as well as addressing EV tax hikes.
“It is encouraging to see the Chancellor address apprenticeships in the Spending Review, bringing much needed funding in the form of £1.2bn for young people to enter training and upskilling programmes. This is a positive action to address the rising unemployment
The RAC
RAC head of policy Simon Williams said: “Giving councils the certainty of longer-term funding to fix their roads is something we’ve called for many years, so this is excellent news.
“Local authorities now have a golden opportunity to end the cycle of merely filling potholes and instead begin to be much more proactive in their maintenance. This must include both more surface dressing to keep decent roads in good condition and resurfacing those that are at the end of their lives.
“It’s incumbent on councils to grasp this new opportunity and show all road users how it’s making a genuine difference in the quality of the roads they use every day.”
BVRLA
BVRLA chief executive Toby Poston said: “The government is clearly committed to its road transport decarbonisation targets and giving serious thought to how it achieves them.
“The mandate flexibilities announced in April relieved the pressure on EV supply, today’s cash commitment could give a much-needed boost to demand.
“This £1.4bn could make a big difference in driving stronger and wider demand for vans, trucks and used electric vehicles. We will continue to work with colleagues at OZEV to highlight how this money can achieve the best return on investment.”
