Targeting the automotive industry for sustainable development: an assessment of the British Automotive Council

Type de publication:

Conference Paper

Auteurs:

Dan Coffey

Source:

Gerpisa colloquium, Paris (2014)

Résumé:

22nd GERPISA COLLOQUIUM (Theme Number 5)
6-4 June 2014: Kyoto

Targeting the automotive industry for sustainable development:
an assessment of the British Automotive Council

Dan Coffey
Senior Lecturer in Economics
Leeds University Business School
University of Leeds, Leeds, LS2 9JT
+ 44 (0) 113 3434485
Email: djc@lubs.leeds.ac.uk

Keywords
Automotive Council, road-maps, sector-targeting, industrial policy, sustainability

Abstract
The British Automotive Council is a permanent joint industry-government deliberative body established in 2009 upon the recommendation of the New Automotive Innovation and Growth Team – an industry-led policy review team which reported that same year (HMG 2009a). The Council was conceived in the context of efforts to revitalise Britain’s manufacturing sectors, and its founding coincided with a new national Low Carbon Industrial Strategy (HMG 2009b). In broad terms, impetus came from a range of sources: the Stern Review of the economics of climate change; the King review of low carbon cars and early moves to evolve a low carbon transport strategy for Britain; and more generally growing concern at the weaknesses evident (even before the 2009 crisis) in British manufacture (see inter alia: HMG 2006; HMG 2007/ 2008; and HMG 2008). This paper explores the issues and obstacles facing the Council in its work, and its emerging role as a benchmark for British industrial policy at large.

In summary terms, British industrial policy has been dominated in recent years by an institutional mind-set preferring a horizontal policy framework. Horizontal policy measures refer to policies intended to apply equally across a range of industries or sectors, as opposed to sector-policies targeting specific industries. Within this approach, British policy makers have given most weight to efforts to devise and maintain an attractive environment for international investors (for a review of the evolution of this approach, see Coffey and Thornley 2014). The weaknesses revealed in the aftermath of the financial crisis in Britain’s manufacturing output – in 2009 absolute manufacturing output for the national economy was observed to be smaller than in 1973, Britain’s first year inside what is today the EU – together with concern about the longer term consequences of an unbalanced developmental trajectory skewed towards financial services, real estate management, insurance, and other tertiary sectors, has led to a partial policy rethink: there is a new willingness to engage with sector-specific targeting, with early efforts to develop a sectoral policy framework (see HMG 2012). It is in this connection that the automotive industry, together with other larger manufacturing industries in Britain including (notably) aerospace, has emerged as a flagship sector to be learned from and copied by other British sectors.

This intended reorientation, away from sole reliance on a nominally horizontal policy framework to include a supplementary use of sector-specific measures, has been encouraged by a growing policy sense of the industrial specific – and occasionally location specific – needs of low carbon development. In the case of automotive, for example, in addition to a menu of tax and subsidy options intended to encourage the uptake of alternative vehicle technologies, the need for new infrastructures has impressed itself upon policy makers (for a brief overview of the British policy mix see Coffey and Thornley 2013). The Automotive Council is charged in this respect not only with creating a more predictable policy environment to encourage inward investment, but to do so in a way that is conducive to commercially viable sustainable technologies. Its work to date has included efforts to (further) develop a series of road-maps for the sector (engaging in this process stakeholders including OEMs and supply groups) aimed at advancing a transition to low carbon forms of automotive transport. Its two main working subgroups deal directly with technologies and supply chains. A new strategy document for ‘growth and sustainability’ in Britain’s automotive sector, partly reprising earlier reports, has been launched (see HMG 2013).

The purpose of this paper is to explore the role of the Automotive Council with respect to the automotive industry itself and as a prospective reference point for other branches of manufacture concerned with growth and sustainability. The analysis is organised in sections as follows: (a) an overview of Britain’s changing industrial policy landscape and the low carbon strategy; (b) an account of the formal remit of the Automotive Council, its organisation and structure; (c) an assessment of its impact to date on the developmental trajectories of the automotive industry and its emerging role as an institution to be emulated by other manufacturing industries in Britain, and vis-à-vis growth and sustainability. The paper also reviews Britain’s new automotive strategy positioning.

References
Coffey, D. and Thornley, C. (2013) ‘Nurtured Competition and Optimal Vehicle Life: a missing theme in public policy formulation for alternative vehicle technologies?’, International Journal of Automotive Technology and Management, vol. 13, no 2, pp134-154

Coffey, D. and Thornley, C. (2014) ‘Industrial Policy: the British Case’, in F. Gerlach, M. Schietinger and A. Ziegler (eds) Industrial Policy In Europe (forthcoming)

Cowling, K., Oughton, C. and Sugden, R. (1999) ‘A reorientation of industrial policy? Horizontal policies and targeting’, in K. Cowling (editor) Industrial Policy in Europe: Theoretical Perspectives and Practical Proposals, London and New York: Routledge, 1999, pp17-31

Griffiths, A. and Wall, S. (2012) Applied Economics, Harlow, Essex: Pearson Education Ltd.

HMG (2006) Stern Review: The Economics of Climate Change, HM Government: HM Treasury, October

HMG (2007/8) The King Review of Low Carbon Cars: Part I and Part II, HM Government: HM Treasury, October 2007 and March 2008

HMG (2008) Manufacturing: New Challenges, New Opportunities, HM Government: Department for Business, Enterprise and Regulatory Reform (BERR), September

HMG (2009a) New Automotive Innovation and Growth Team: An Independent Report on the Future of the Automotive Industry in the UK, HM Government: Department for Business Enterprise and Regulatory Reform (BERR)

HMG (2009b) The UK Low Carbon Industrial Strategy, HM Government: Department for Business, Innovation and Skills (BIS) and Department for Energy and Climate Change (DECC)

HMG (2012) Industrial Strategy: UK Sector Analysis, HM Government: Department for Business, Innovation and Skills (BIS)

HMG (2013) Driving success: a strategy for growth and sustainability in the UK automotive sector, HM Government: Department for Business, Innovation and Skills (BIS) (Paper Series BIS/13/1975), July

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