SECTOR FOCUS

• 11 of the world’s volume vehicle manufacturers have a UK presence, together with the majority of the world’s top suppliers

• In 2010, the UK produced more than 1.4m vehicles and some 2.4m engines

The exciting development that will bring a sharp boost to suppliers has been the decision to build an all-new Astra at Ellesmere Port, which employs over 2,000 workers, starting in 2015. In return for flexible working hours that include round-the-clock production through the year, unions cut a deal with GM requiring the company to increase its share of UK suppliers from 10 to 25 per cent, according to Denis Chick, a Vauxhall spokesman. “The new supply contracts cover the life of the new product, around eight years (alongside 10-year contracts for van production).

Five years ago the picture for Vauxhall was very different, says Chick. “At the time Lord Mandelson recognised the importance of UK manufacturing when he visited us and this interest further developed through the change of government. This strategy became very relevant as it came to the crunch 18 months ago when GM was making decisions about where to invest. Business secretary Vince Cable went to see Dan Askerson, chairman of GM.

models at Oxford” Phil Harrold, PwC

“He was able to sell to GM what a good place the UK is to build cars. That was a big help on top of the huge amount of work done by the company, its employees

A Centre for Advanced Propulsion focusing on engine technology could be revealed this summer

and union UNITE, ensuring that Ellesmere Port was secured and is and now at the top of the efficiency tree. We are now talking to the government about training grants and we are also determined to ensure that we have the right number of apprentices to support business growth.” Many suppliers are looking to expand to fill a fast growing order book as the big volume producers increase their output. Ian Malcolm, managing director of the UK division of ElringKlinger, a German components business on Teesside, says he is looking to bolster the workforce by another 60 employees to around 190 and is considering a £3m factory expansion in the coming months. “I set a target of doubling our 2011 sales of £13m by 2016. We are 95 per cent of the way there,” he says. Malcolm says that of the 60 new staff, 35-45 will be unskilled labour that will be relatively easy to recruit locally. The remaining 15-25 of staff will be more difficult to fill. “There’s a huge shortage of engineers,” says Malcolm. ElringKlinger’s UK division is representative of the many cogs in the chain that ensure that the big manufacturers are able to maintain their output levels, a point not lost on UK Trade & Investment representatives. “We have been talking to UK Trade & Investment in the last three months,” says Malcolm. “The consular head visited our holding company in Germany recently, a valuable exercise in keeping our main board onside,” he says. Ensuring the automotive industry has the right set of skills is very much on the agenda of the Department of Business, Innovation and Skills (BIS), which is looking

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