Blair McDougall

With permission, Madam Deputy Speaker, I wish to make a statement on the Government’s support for Jaguar Land Rover and our wider automotive sector. I offer my apologies on behalf of the Secretary of State, who is on his way to France to talk to our trading partners there. As the House will be aware, Jaguar Land Rover recently announced approximately 4,000 redundancies as part of a £1.7 billion cost saving effort, and the company now intends to consult on the job losses that are planned over the next two years. Although Jaguar Land Rover has stated that these losses will not impact production staff, the news will undoubtedly come as a terrible shock to all of the company’s employees. My right hon. Friend the Secretary of State and I have been in regular contact with the company and the relevant unions since the Government became aware. We have made it clear that we want to see the company reducing the impact on workers through the consultation period and that all employees deserve maximum clarity on the extent and focus of its plans for non-production workers, which the Business Secretary and I encouraged the company to do earlier today in a meeting with the company and the Unite general secretary. We recognise, too, the impact that those redundancies will have on local skills. There is a deep advanced manufacturing skills base in the west midlands, and this Government are working together with employers and the combined authority to retain that skills base within the regional economy, including by backing Mayor Richard Parker’s £500,000 support package for JLR workers taking voluntary redundancy. The Department for Work and Pensions also stands ready to support anyone affected through its rapid response service, which provides support and advice to employers and employees facing redundancy, including help with finding new work and training. Hon. Members will know that, over recent years, Jaguar Land Rover has been forced to confront a series of challenges, many of which have been shared by vehicle producers all over the world, which I will say more about shortly. One of the unique challenges the company faced last year, however, was a significant cyber-attack that temporarily halted production for several weeks. However, with help and support from this Government, including a £1.5 billion loan guarantee, it resumed operations and reopened assembly lines. Make no mistake: when British industry is attacked, we will step in to defend it, and defend it strongly, in our national interest. In this case, however, Jaguar Land Rover has cited global market conditions as one of the principal reasons for job reductions. Indeed, similar announcements from manufacturers such as Volkswagen and BMW underscore the challenging global headwinds that nearly all automotive manufacturers are facing right now: tariffs, high energy costs, the transition to electric vehicles, and stiff competition from overseas producers. We recognise those challenges, and are using our modern industrial strategy to help our car industry to rise to them. Through our DRIVE35 programme—driving research and investment in vehicle electrification—we are ploughing more than £4 billion into our automotive sector to support the electrification of vehicle plants alongside batteries, electric motors, hydrogen fuel cells and power electronics. It is the biggest investment in our car industry of the post-war era. Jaguar Land Rover has benefited from that funding, with £40 million of public and private investment going into advanced software-defined vehicles, supply chain resilience and lightweighting. Alongside that funding for innovation and next-generation technologies, hon. Members will know that the Government have made a considerable grant investment into Agratas’s gigafactory in Somerset, which is strengthening not only the UK’s battery production capability but the automotive industry and companies like Jaguar Land Rover, which will benefit from a secure domestic supply. When it comes to energy costs, our British industrial competitiveness scheme will save more than 10,000 manufacturers up to 25% of their electricity bills. This will almost certainly include some of the biggest companies in the automotive sector, including Jaguar Land Rover. The successful applicants for that scheme will be announced soon. On global market conditions and tariffs, this Government have acted decisively to secure trade agreements that support our nation’s car manufacturers. Our economic prosperity deal, for example, includes a preferential rate of 10% on the first 100,000 UK-made cars exported to the USA each year. The US is obviously a major export market for Jaguar Land Rover—the biggest, in fact—as it is for so many other high-value manufacturers in the UK, which is why we worked so hard to secure that deal. We remain the only country in the world subject to a 10% tariff for automotive exports, with other nations facing a much higher rate. We have placed just as much importance on vehicle exports in the other trade deals we have negotiated since taking office, including the landmark agreement we secured with India—an agreement that reduces tariffs on British-made vehicles from roughly 110% to 10%. This is a significant win for Jaguar Land Rover and other manufacturers, as India is already a huge market, with consumers set to grow by millions in the coming decades as the country’s economy fast expands. I should also touch on the zero emission vehicle mandate, which provides a clear pathway to phase out new petrol and diesel cars and vans. We always said we would keep it under review. We always said that we needed a pragmatic and balanced approach. That is the right thing to do, because discouraging the production of electric vehicles does not make good business sense for anyone. The fact is that consumers want them, with recent stats showing that for the first time in the UK, electric vehicles have outsold petrol cars over a 12-month window. Europe reached a similar milestone recently. Electric is the future. As part of our ambition to reindustrialise our country, we absolutely want those electrical vehicles to be designed and built in Britain. A mandate to steer the industry into that electric future is needed, but, equally, if we accept that zero emissions is the destination, we have to partner with industry to get there. I know that Jaguar Land Rover is of that view too. We are consulting with the company and other manufacturers to ensure that the ZEV mandate works for our automotive industry—that it strikes the right balance, with targets that are ambitious yet realistic. The consultation on the ZEV mandate review closes on 23 October. Jaguar Land Rover remains our largest car manufacturer. It is a linchpin of the UK automotive sector—a company with a long and proud history. Over many decades, it has become synonymous with the best of British design and engineering. That is true for past models such as the E-Type, the XJS, the F-Type, and it is true for the firm’s modern line-up, including the Land Rover Defender and the Discovery. These vehicles endure. Years after production ended, I note that the Jaguar I-PACE is still a vehicle of choice for companies operating driverless cars in the US and those testing them here in the UK. With last week’s launch of the new fully electric Range Rover, I am confident that Jaguar Land Rover will get past this difficult period. It will emerge from it stronger and more competitive, holding its own in the global car market against the best of them from Germany, the United States and China. For our part, we will use our industrial strategy and DRIVE35 to support JLR and the British automotive sector in this journey. In doing so, we will guarantee Britain’s status as a proud, successful car-making nation for many years to come. I commend this statement to the House.