• During COVID car sales dropped to 1.6m in 2020 (the lowest it’s been since 1992) after peaking at 2.7m in 2017 Johnson Matthey PLC

• British chemicals company exiting the battery chemical market

• Hinders UK EU production -> chemicals must be imported from the dominant Chinese and European firms

• Left due to a lack of profit as competition pushes down the price

Nissan

• Nissan production uses Kaizen to refine flow to be more efficient and minimise errors

Sutherland Nissan factory: • 2 lines making 519,000 per annum • 6,000 directly employed + 30,000 indirectly employed • £10 million battery facility nearby • Uses 10 wind turbines and solar farms • Since 2011 employees have undergone 2 million hours of training for electric vehicles • Heavily automated • 900 employed in research + development • Second battery factory underway

SWOT ANALYSIS: BRITISH CAR INDUSTRY

• Strengths: • Globally recognised brands e.g., Land Rover, Mini • Good supplier network, especially for engines • Proximity to Europe • High education levels for quality manufacturing

• Weaknesses: • In 5 years, the UK production has halved • Brexit complicates exports • Low attraction for FDI due to Brexit (no longer in a trading bloc) • Few factories at a globally competitive scale

• Opportunities: • High innovation can be capitalised on using higher education for quaternary expansion • Electric vehicle production requires investment in battery production (gigafactory proposed next to Coventry airport)

• Threats: • No battery plants, very far behind in the transition to electric vehicles • Electric minis made in China instead of Oxford (easier to assemble there) • $7,500 subsidy in the US for each “green” car threatens 16% of UK exports going to the US

Trends:

• In the last 10 years, sales have dropped (in the market by 32%)

• Though sales of petrol and diesel cars slumped, sales of battery electric cars such as the Nissan Leaf grew to about 6.6% of the UK market

• Shift towards SUVs – 40% of annual car sales (twice as high as it was 10 years ago) • Electric vehicles and increased efficiency saved 2.1m barrels a day of diesel and petrol, but SUVs added 3.3m barrels a day • Electric vehicles on the world’s roads expected to increase to 145m by 2030

As the motor industry turns electric, it is important for employees to have digital/electrician skills to repair and understand how the car works, making it more difficult to recruit as there is a higher demand for highly skilled/qualified workers rather than apprentice/mentor relationships which were more common in the past.