'Gov't must provide leadership now'

The need for the government to work with the automotive industry and draw up a sector-specific plan of support has become even more urgent as job losses in the industry continue to mount every week.

Most recently, car components firm Sertec announced that it would be making extensive redundancies, which Unite has called another ‘fresh blow’ to the industry in the West Midlands.

The company, which produces car components for JLR, Nissan and Toyota, has announced that it is intending to make 428 redundancies from its 1,300 employees. The majority of the workforce is currently furloughed under the government’s job retention scheme (JRS).

The redundancies will occur at its factories in Coleshill, Hams Hall, Redditch, Tyserly, Witton and Aston.

Unite regional officer Jason Richards said he was seeking urgent meetings with the company to persuade them “to reverse this decision or delay it so that a more accurate assessment of the automotive sector can be made”.

“This is a premature decision as most of the workforce is currently furloughed. The government’s job retention scheme was not designed as a vehicle to make workers redundant,” he said.

“By undertaking a redundancy programme while workers are furloughed, Sertec is denying Unite its legal right to meaningfully consult with union members and allow the union access to the entire bargaining group,” he added. “This is impossible when the workforce is furloughed under a scheme that specifically precludes employees from working.

“If the redundancy programme does proceed then Unite will be seeking to mitigate job losses and ensure that compulsory redundancies are kept to an absolute minimum.

“Unite will ensure that all affected workers are treated fairly and receive everything that they are legally entitled to.”

150k job losses ‘worst case scenario’ for auto industry

The latest job losses announcement at Sertec comes in the wake of thousands more job losses in the sector – last week, Bentley announced it would be axing 1,000 roles, while carmaker Aston Martin also said last week it would be ploughing ahead with 500 redundancies, a majority of which are expected to fall on the firm’s plant in Warwickshire.

Bentley currently employs 4,200 workers at its factory in Crewe, Cheshire. The proposed 1,000 redundancies, which will be on a voluntary basis, account for just under 25 per cent of the workforce.

Commenting on the Bentley job losses, Unite national officer Steve Bush called the news “another sorry reminder of the battering this sector is taking, caught by a downturn in global demand which has then been supercharged by the global Covid-19 pandemic.

“It is absolutely essential that the government works with the automotive industry and Unite to bring forward the sort of sector specific support we are seeing other governments deliver, in France and Germany, because for every automotive job that goes, four more will go in the wider supply chain,” he said.

Meanwhile, Unite regional officer Tim Parker responded to the Aston Martin jobs loss announcement, noting that the union would do all it can to ensure that all redundancies were voluntary. He also highlighted the need for government support

“We call on the UK government to provide financial support and investment for Aston Martin to protect the future of this UK-based world class sports car manufacturer and the thousands of jobs that rely on it through the UK components chain,” he said.

 “We can’t allow jobs at this iconic British company to be sacrificed on the altar of short-termism – we need to plan now for the post-pandemic economy and getting rid of Aston Martin workers is not a good start for achieving that goal.”

Job losses at three different car sector firms have happened in only a matter of days – since the coronavirus crisis began, an estimated 5,000 jobs in the industry have been lost. And this is thought to be only the tip of the iceberg.

The Financial Times reported estimates of up to 150,000 job losses in the UK’s automotive industry in the coming months – this would represent a quarter of all jobs in the sector, which employs more than half a million people in the UK.

“In the best case, it’s tens of thousands, in the worst case it’s more like 150,000,” the chief executive of one dealer group told the Financial Times. “Until the furlough scheme is concluded, until the [Brexit] transition agreement is done, we are all insulated from the reality of the situation.”

Scrappage scheme

Unite has long warned that the UK car industry, already buffeted before the coronavirus crisis by a fall in global demand, is now in even direr straits after car production plummeted by 99.7 per cent in April alone.

Unite has said the industry will need a sector-specific deal from the government to save jobs and vital skills in the UK’s heartlands that, once gone, will never come back.

Unite reiterating its call for government support comes as it was revealed today (June 8) that the government may introduce a new scrappage scheme offering drivers discounts of up to £6000 to switch from petrol or diesel to electric or hybrid cars.

Responding to speculation that the government is considering introducing this scrappage scheme, Unite has warned that further urgent investment and infrastructure development is needed to maximise the success of any initiative.

Further, its introduction now could simply delay consumers purchasing existing models, including hybrids, which keep the UK industry alive and provide the investment necessary for the transition to full electric vehicles.

The UK does not currently have the charging infrastructure in place to make electric cars an attractive proposition for many drivers.  If the scheme were to be brought in at the moment it would not provide an advantage to the UK’s struggling automotive sector as very few electric-only cars are currently built in the UK.

With the transition to electric cars not realistically imminent in the UK, consideration and support must also be given to highly modern low emission internal combustion engines which are being built in the UK.

Of even greater concern is that the UK does not currently produce an electric (transit-sized) van, which given the type of journeys these vehicles undertake is a huge missed opportunity to contribute to meeting the climate change challenge.

Unite assistant general secretary for manufacturing Steve Turner said, “While as part of an integrated approach to transitioning the automotive sector this could be a game changing initiative, for that to be achieved the government will need to announce a rapid expansion of the charging infrastructure and, in particular, the provision of fast charging points.

“Drivers are not going to invest in an electric car if they are concerned about its range and worried about the difficulty of charging it,” he added.

“The introduction of a car scrappage scheme must also coincide with a dramatic move to produce a far higher number of electric models and components in the UK, otherwise the scrappage scheme will simply benefit overseas producers and not domestic production.

“The transition to electric vehicles will not occur overnight.  During this period the government must also be promoting and assisting the new generation of low emission, internal combustion engines that are produced in the UK.

“Due to the combination of the COVID-19 pandemic and Brexit, tens of thousands of automotive jobs are at risk and any initiatives that the government considers must be focussed on securing and promoting skilled employment in the UK.

“It is essential that the government provides leadership right now and introduces any incentives, as the French have done, with measures targeted at promoting UK manufacturers and component suppliers. Incentivising the industry to produce an electric van here in the UK would be a good start.”