LOW CARBON VEHICLE PARTNERSHIP CONFERENCE 2014: THE UK AUTOMOTIVE INDUSTRY WORKING WITH GOVERNMENTJuly 16, 2014
There were a number of key messages that came out of the 2014 Low Carbon Vehicle Partnership Conference, which we cover below, but one of the main themes was how the UK economy has benefited from the recent growth of the automotive industry, and how low carbon policy has assisted with this.
A new report was launched at the event, entitled “Investing in the low carbon journey: Lessons from the first decade of UK policy on the road to 2050”.
The report headlines were:
• Over the last decade, unprecedented and sustained reductions in carbon emissions (tailpipe emissions down by a quarter) have coincided with rising investment in the UK automotive sector. Fuel costs for motorists are also lower than they would otherwise have been due to improved efficiency – a ‘win-win-win’ for the environment, industry and consumers.
• A clear policy focus (backed by the Stern Review and the Climate Change Act, amongst others) combined with a suite of supportive and sustained policy mechanisms (across and between governments) have created a favourable environment for low carbon auto investment in UK.
• UK investments in low carbon automotive amount to c£40bn since 2003 and total UK auto sector investment has also risen.
• UK automotive production and exports are rising and there is a recent strong revival in R&D spending. UK auto sector turnover was £64.1bn in 2013 compared with £46.3bn in 2003. Exports as a proportion of UK car production are up 10% compared with a decade ago.
• European ‘Cars and CO2’ regulation has underpinned progress; a vital component in creating a ‘level playing field’ for investors.
• Findings point to the effectiveness of collaborative approach between government, industry and other stakeholders which has created a climate of confidence for investment the auto industry.
• The UK has made a good start on the road to decarbonising its road transport sector but there are greater challenges ahead: the truck sector has been neglected and fuels policy has been problematic.
• Policy changes have helped to produce a healthy UK bus and coach sector with nine manufacturers and a total UK market of 3,685 units in 2013.
• Work on the supply chain, the skills base and air quality improvements must also be supported in order to create industrial depth and resilience for the long term.
Here’s our summary of other key points from the 2014 Low Carbon Vehicle Partnership Conference:
The big step change that has happened has been the automotive industry collectively sitting down with government and charting the strategic way forward. There has been a unique era of co-operation between industry and government – described by Joe Greenwell, Chief Executive Officer, Automotive Investment Organisation, as “the most significant development in the UK automotive industry in decades.”
This co-operation was seen as a ‘defining moment’ and it initially led to the formation of the New Automotive Innovation & Growth Team (NAIGT), and subsequently the Automotive Council.
Combined with this was the creation of the Automotive Council’s ‘passenger car low carbon technology roadmap’, which was quoted a number of times during the event as being responsible – by charting the future of powertrain technology in the car industry (up to 2050) – for providing a secure and stable base from which to attract significant investment.
Other organisations have also been formed, all with the aim of helping to develop the UK automotive industry. These include:
Low Carbon Vehicle Partnership
Technology Strategy Board
Office for Low Emission Vehicles (OLEV)
Automotive Investment Organisation (AIO)
High Value Manufacturing Catapult
The Proving Factory
Advanced Propulsion Centre
All these organisations play a part in aiming to bridge the much talked about ‘valley of death’ – the area where many innovative ideas fail before they reach full scale commercialisation.
One of the outcomes of the focused approach above was the ‘Driving Success’ Automotive Industrial Strategy, published in 2013. This document also reiterated the benefits of continued government engagement with the automotive industry and maintaining a long-term policy framework, not just for the five years of a Parliament, but for 15-20 years.
The large OEMs may be central to the success of the car industry in the UK today, but there are also over 100 niche vehicle manufacturers, a valuable attribute that is unique to the UK, and which reflects our innovative engineering approach.
It should also be remembered that there is one key issue that is driving the growth of low carbon vehicles – the 2008 Climate Change Act, which stated that by 2050 the UK must reduce its CO2 emissions by 80%, from 1990 base levels. The only way to achieve this is by the electrification of vehicles – either full EVs, or plug-in hybrids or range-extenders. However this is only going to work if the UK electricity grid is also decarbonised.
Thankfully work is underway to make UK electricity supply greener at a national level, but Dave Roberts from My Electric Avenue highlighted that there is an issue at a local level, where, in some cases, the local electricity network may not have the capacity to cope with the recharging of increasing numbers of ‘clusters’ of electric vehicles at the same time. Therefore My Electric Avenue has secured £9m of funding from Ofgem to create clusters of electric vehicles around the UK with the aim of finding out how the local electricity grid will cope with this situation, and to test a solution called Esprit, which will control the recharging in a way that prevents the local electricity network being overloaded.
Another issue raised was that, due to legislation, the vehicle industry has been focusing on CO2 emissions, but this approach needs to be aligned with local air quality issues. This tied in with one of the afternoon’s panelists, Cedric Bollore from Bollore, whose aim is to start up an electric car sharing business in London, which would involve the company taking over the Source London scheme. The initiative would be based on their Paris EV car sharing model, where they have 55,000 clients, 14,000 rents per day, and 8% have ‘abandoned’ their own car.
Growing the number of EVs in London, that are easily available for people to drive – ideally meaning that they don’t have to own their own car – would help to significantly improve air quality in London. To achieve this, Bollore is planning to increase the number of electric recharging points in London, from 1,400 to 6,000 in 3-4 years. Charges would be based around £4 for half an hour, with an average trip lasting 40 minutes. If four people were in the car, that would be £1 for 40 minutes of zero-tailpipe emission transport, with the ability to pick the car up from one location, and dropping it off somewhere else.
The conference delegates were given a rousing speech to spur them into low carbon vehicle action at the post-conference reception by Lord Deben, Chairman of the Committee on Climate Change, and better known to most people as John Gummer. Lord Deben suggested that the uptake of electric vehicles would soon grow more quickly than has been the case so far.
However the ‘most consistently engaging speaker award’ must go to Jerry Hardcastle OBE, General Manager, Innovation and Performance Projects at Nissan, and Chairman of the Automotive Council’s Technology Group. Jerry summarised that there are incredible opportunities in the low carbon vehicle industry today, and there’s even more excitement about what can come next – but the UK automotive industry must not get complacent, instead it must continue to build on the current momentum.
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