UK govt must take urgent action to help EV transition - car lobby

EV Show in London

By Nick Carey

LONDON (Reuters) - The UK's car lobby on Tuesday called on the government to take urgent action to help the industry transition to electric vehicle (EV) production, including support for high energy costs, tax reform and investment in charging infrastructure.

The Society of Motor Manufacturers and Traders (SMMT) said the UK auto industry faces "multiple threats" as it shifts away from fossil-fuel technology, including "economic instability, trade protectionism, regulatory change, a cost of living crisis, skills shortages and soaring energy costs already some 80% higher than the EU average."

Britain's car industry also faces a Brexit-related challenge. Under rules of origin agreed with the European Union, starting in 2024, a rising proportion of a car must be made locally. So Britain is under pressure to build its own EV battery supply chain.

UK government efforts to foster an EV battery industry have only led to one factory project planned by Britishvolt, a startup that has struggled to gain traction with investors.

Without enough battery plants, some fear automakers could leave, hitting an industry that employs about 170,000 people.

This comes as the government under former prime minister Boris Johnson has pushed for a UK ban on new combustion engine models by 2030.

The SMMT said it wanted a government plan to "ensure competitiveness, attract investment and drive skills, innovation and long-term growth."

The lobby group said that should include "extended support" for energy costs, help for struggling small and medium-sized businesses, tax reform to encourage investment, the creation of a national skills platform and investment to speed up the creation of EV charging infrastructure.

"We need swift and decisive action that addresses the immediate challenges and gives us a fighting chance of winning the global competition," SMMT Chief Executive Mike Hawes said. "That window of opportunity is open but is closing fast."

(Reporting by Nick Carey; Editing by Bernadette Baum)