UK carmakers want more engineers

28 June 2011 Last updated at 16:32 GMT By Jorn Madslien Business reporter, BBC News Modern car factories are clean and are full of hi-tech equipment, industry officials insist The UK motor industry is throwing open the doors to 23 of its car and component factories on Wednesday.

The move is in line with the government's ambition to tilt the economy away from financial services.

The carmakers want to convince young people that it is both fun and lucrative to work as engineers.

"The industry today is hi-tech," according to Tony Walker, deputy managing director of Toyota Motor Manufacturing UK.

"There are no oily rags. There are no smoke stacks," he said during the annual summit of the UK motor industry body SMMT.

"It is an inspirational and an aspirational place to be."

Major investment

The UK should focus on high-margin manufacturing, insisted Stephen Odell, chairman and chief executive of Ford of Europe, at the event.

"We fully support the UK government's goal of rebalancing its economy, putting a greater focus on low-carbon technologies, manufacturing and exports," he said.

And recognising that the motor industry must pull its weight to make it happen, the companies operating here are ready to put their money where their mouths are, Mr Odell insisted.

"BMW, Nissan and Jaguar Land Rover have announced significant investments," he observed, referring to recent declarations by BMW to invest ?500m in UK car production over the next three years, by Nissan to invest almost ?200m and by Jaguar invest some ?5bn ($8.2bn) on product development and updating its factories.

"At Ford, we're investing a further ?1.5bn in UK operations to support future low-carbon and high-value R&D [research and development] and manufacturing," Mr Odell continued. "This will be concentrated over the next five years."

Lucrative career

Carmakers in the UK fear that not enough young people want to become engineers.

Ford of Europe chief Stephen Odell says the motor industry is pulling its weight

"Meanwhile, our rivals provide the sort of educational infrastructure that provides an educated workforce," said Mr Odell.

There is a simple reason why this is the case, according to Chris Williamson, chief economist with Markit.

"It's the money," he said. "You can see how much money you can make in financial services and that's where you'll go."

Richard Parry Jones, who chairs the government's Automotive Council, believed many make the wrong choices.

"Yes, a very small amount of people in financial services win the lottery, as it were, and land huge rewards for their work," he said.

But average salaries for engineers in the manufacturing sector are double those earnt by recent graduates who take jobs in the financial services industry, he insisted.

Inspiring the young

To challenge some of the myths about the manufacturing sector, the carmakers and component suppliers are welcoming head teachers and careers advisers, as well as students and teachers, to tour their facilities during Wednesday.

Business Secretary Vince Cable is also taking part, touring the Mini factory in Cowley outside Oxford.

"Together with industry we must inspire more young people to see manufacturing and engineering as a viable and exciting career choice," he said, stressing the "need to ensure that UK manufacturing can take on its competitors head on".

The hope is that manufacturing engineering could become status professions the way they used to be, according to James Davies, co-head of global sales and marketing at parts-maker Calsonic Kansai.

"We'll need to work with our young people," he said.

"It's about inspiration and education."

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EU carmakers cry foul over trade

9 June 2011 Last updated at 17:19 GMT By Jorn Madslien Business reporter, BBC News European carmakers want 'a level playing field' The European motor industry has called for non-European governments to scale back assistance for their own automotive industries.

But at the same time, they say they want more government support at home.

Governments in Europe should support the industry's efforts to cut car emissions, European car maker bosses agreed during a meeting in London.

But other governments should remove tariffs and other barriers to trade, they said.

Infrastructure and research

The seemingly contradictory positions taken by the chief executives, during a board meeting of the European Automobile Manufacturers Association, may not be as outlandish as it first seems.

The assistance the carmakers want at home relates to issues like like funding a national roll-out of the power charging infrastructure for electric cars.

They have also called for short-term assistance with research and development into electric cars and other new technologies.

Daimler chief executive Dieter Zetsche is calling for a level playing field.

"We in the industry have to take the lead," said Dieter Zetsche, chief executive of Daimler and president of the European Automobile Manufacturers Association ACEA.

He said European carmakers would invest billions of euros in green technologies.

"In Germany alone, the automotive industry will invest about 16 bn euros," he said.

"Over the next five years we will see no return on that investment."

'We don't get access'

The car chiefs say import tariffs and other barriers to trade - notably in India, China, South Korea and other large emerging markets for cars - should be scaled back.

The tariffs make it difficult for European exporters to compete with domestic manufacturers.

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Eight million jobs are related to the automotive industry in Europe, 700,000 of them here in the UK”

End Quote Dieter Zetsche European Automobile Manufacturers Association ACEA For example, India exports 250,000 cars to Europe every year, but only imports 5,000 vehicles from Europe, according to Paul Everitt, chief executive of the UK motor industry group SMMT.

And he said Japan should also do more to open up its market to imports.

"Our vision is for us to design, develop and manufacture high-value vehicles to export around the world.That is difficult if we don't get access."

Mr Zetsche said he was convinced the European motor industry was the most advanced in the world, and would be perfectly able to compete globally in a truly free market.

"We are asking for a level playing field," he said.

Economic health

Developing countries often insist they need to protect their strategically important embryonic growth industries against powerful rivals from industrialised countries, in part because they want to create economic growth and reduce poverty at home.

Although this might be fair in some instances, said Mr Everitt, carmakers in India, China and South Korea were both large and resourceful and should no longer need protection.

The European Automobile Manufacturers Association points to its importance to the economic health of Europe and has urged EU governments to treat it as a strategic industry.

"Eight million jobs are related to the automotive industry in Europe, 700,000 of them here in the UK," Mr Zetsche said.

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Carmakers hit in new market slide

2 June 2011 Last updated at 13:06 GMT Continue reading the main story Shares in European carmakers have been hit in a renewed stock market sell-off.

Peugeot suffered most, almost 5% lower in Thursday afternoon trading, while Renault was 2.1% down and Daimler 1.6%.

It comes after new data showed car sales had continued to drop in France and Spain in May, following the expiry of government subsidies for sales, while US car sales also lagged.

Markets remain concerned about the strength of the global recovery after weak manufacturing data from the US.

European markets were down about 1% after Asian shares ended the day lower, with Japan's benchmark Nikkei 225 index down 1.7%.

On Wednesday, a survey indicated that growth in US manufacturing in May slowed to its lowest rate since 2009, while separate data showed that private employers in the US hired fewer workers in May than had been expected.

Tough times

Meanwhile, US car sales in May were at their lowest seasonally adjusted rate in eight months, and well below expectations - though some of the shortfall may be due to supply problems related to the Japanese earthquake.

The poor data sent shares in General Motors and Ford about 5% lower on Wednesday.

On the other side of the Atlantic, car sales in France were down 8.3% in May from a year earlier on a seasonally adjusted basis, following a drop registered in April.

A French sales incentives scheme ended in December, although sales that benefited from the subsidy continued to be registered until March.

In Spain, sales data registered a 23% drop versus a year earlier - the 11th drop in a row. However, sales in Italy registered a rebound.

Japan's car sector also reported bad news, as data showed that sales of Japanese cars in the US dipped in May.

Sales at the world's biggest carmaker Toyota were down by 33%. Honda Motors reported a 23% dip in sales, while Nissan Motors witnessed a 9% drop.

It is unclear how much of the sales fall was due to disruption to the carmakers' supply chains caused by the 11 March earthquake and tsunami.

However, shares in car manufacturers fell on the Tokyo Stock Exchange, with Toyota down 3.3%, Honda 2.4% lower and Nissan down 3.2% at the close of trade.

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