Auto makers can drive UK’s green growth agenda with carbon emissions halved

Britain’s automotive sector is today urging the new Labour government to use the industry’s decarbonisation success to the UK’s economic advantage, as a new report shows direct carbon emissions from vehicle factories halved over the past 25 years – helping position the country as the ideal place to produce the next generation of zero emission vehicles.

The 25^th Society of Motor Manufacturers and Traders (SMMT) Sustainability Report, published today, shows the amount of CO₂ directly emitted in vehicle production more than halved (-54%) compared with 1999 levels – a major milestone achieved through massive industry investment. At the same time, the amount of energy and water used per vehicle was slashed by -18.0% and -17.7% respectively last year, with usage now -33% and -42% below 1999 levels.

UK manufacturers are also helping cut on-road emissions with record volumes of electrified vehicles leaving factory lines in 2023, as output rose by almost half (48.0%).¹ Recent independent analysis suggests that, with the right investment conditions, by 2035 more than a million ZEVs a year could be rolling off UK factory lines – exported worldwide and fuelling billions of pounds of domestic economic growth.²

With the new government’s commitment to an industrial strategy and its already published Automotive Sector Plan, SMMT’s new report signposts the UK’s green growth potential – with automotive its driving force. Collaboration will be crucial, making the UK even more globally competitive, attracting investment not just in finished vehicle manufacturing but in its supply chains and adjacent sectors. Providing more sustainable and affordable energy is pivotal, as are free and fair trade agreements which promote UK-made products globally while ensuring access to critical raw materials. A mass UK market for ZEVs is also needed given manufacturers seek to locate close to where their products are sold. Meanwhile, a diverse and skilled workforce that can design, build, manufacture, maintain and repair ZEVs is fundamental to a successful transition.

Mike Hawes, SMMT Chief Executive, said, “Britain’s automotive sector has been cutting carbon for decades and this new milestone is significant, not just for industry but for the nation’s move to net zero. We look forward to working with the new government to deliver its green growth agenda that puts Britain at the front of the queue for global investment and sustainability leadership. Automotive can be the driving force behind this strategy, reducing carbon emissions still further while growing the economy, improving air quality and delivering new jobs and skills for people across the country.”

The automotive industry is vital to the wider UK economy, with auto-related manufacturing worth £93 billion and delivering £22 billion value added, while typically investing around £4 billion a year in research and development. The sector includes more than 25 manufacturers building over 70 vehicle models, plus specialist small volume manufacturers, supported by some 2,500 supply chain businesses. As a result, the industry’s contribution to employment is significant, with more than 198,000 jobs directly in manufacturing and 813,000 in total across the automotive industry. Many of these are outside London and the Southeast with wages around 13% above the UK average. Automotive also supports jobs in key sectors such as steel, chemicals, plastics, rubber, advertising, finance and logistics.

7 MEASURES TO MAKE SUSTAINABILITY A COMPETITIVE ADVANTAGE IN THE UK:

1. Publishing a green automotive transformation strategy that sets out a holistic, joined-up approach and provides a pathway towards the UK automotive industry’s ultimate sustainability and circularity goals
2. Introducing a package of fiscal, tax and regulatory support measures that attract new investment and ensures domestic vehicle producers are globally competitive
3. Providing support and guidance to empower a sustainable, transparent UK supply chain
4. Mobilising a skilled, diverse, empowered UK workforce
5. Developing a UK regulatory ecosystem in partnership with business that is ambitious, deliverable and harmonised with global regulatory requirements and international sustainability objectives
6. Ensuring UK sustainability data requirements match the high ambitions of automotive companies operating across global markets
7. Maintaining and further supporting access to critical raw materials and cross-border trade, building supply chain resilience to attract investment in zero emission and sustainability technologies