Industry responds to Spring Budget
The Spring Budget delivered by Chancellor Jeremy Hunt has drawn a mixed response from industry, with a 12-month freeze to Fuel Duty announced and a three-month extension to the Energy Price Guarantee, but little support shown for electric vehicle manufacture and uptake.
Mike Hawes, chief executive of the SMMT, said: “We face fierce international competition so it was pleasing to hear the Chancellor directly reference industrial strategy and measures to attract investment. Tax breaks for capital expenditure, which the industry has long called for, extensions to climate change agreements plus action to alleviate the high cost of living and encourage more people into work are all much-needed. Investment zones which focus on advanced manufacturing, of which automotive is an exemplar, R&D and technology are also positive steps.
“There is little, however, that enables the UK to compete with the massive packages of support to power a green transition that are available elsewhere. Indeed, the announced fuel duty freeze contrasts with an absence of measures to boost uptake of zero emission vehicles, such as reducing VAT on public charging. We, therefore, look forward to additional policy announcements that support advanced manufacturing sectors, as the right conditions will enable the investment that drives growth across the country.”
Meanwhile, Jim Holder, editorial director, What Car?, said: “What the budget failed to tackle was the growing need for significant government support for the automotive sector. Just last week, Volkswagen called on the European Union to invest more into support and subsidies for electric vehicle battery manufacturing, while Jaguar Land Rover has asked the UK government the same.
“The industry is at a pivotal point, with countries competing for carmakers to invest into battery and electric vehicle manufacturing facilities. The Inflation Reduction Act in the US has shown how Government support can result in significant investment. If the UK is serious about remaining manufacturing hub in the electric vehicle era, the government must invest more in the sector, otherwise it risks falling behind its global competitors.”
However, the Budget did announce a £200m increase to the Pothole Fund, a three-month extension to the Energy Price Guarantee for another three months, and a 12-month freeze to Fuel Duty.
