A new GBP24m automotive supply tooling fund initiative announced today (25 June), shows the UK’s “serious” intent towards the sector, insists the British government.
Unveiling the news at the SMMT ‘Meet the Buyer’ event in London’s docklands, UK business minister, Michael Fallon, maintained the finance, 50% originating from the Regional Growth Fund (RGF) and 50% from the West Midlands Pension Fund, would protect also protect and generate new employment.
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“It is creating and safeguarding a number of new jobs,” Fallon told just-auto on the sidelines of the SMMT event. “I hope that demonstrates just how serious we re are about the automotive sector and [we are] determined to make sure it has all the support it needs to prosper.
“We work with the Automotive Council in a real partnership [and] today’s programme is a very good example of how government and industry work together and the component sector in particular.
“The RGF is GBP300m for each round – the automotive sector generally has always been a strong recipient of the fund. We have had many successful applications.”
The GBP24m Tooling Funding Programme is targeted to help component manufacturers design, develop and produce new equipment where they would otherwise fail to acquire backing.
The finance is also being used to address how to secure a more competitive UK domestic supply chain, with British-built cars only featuring around 35% home-sourced components.
“The sector has had difficulty in raising mainstream finance from the banks – that is why we are ready to step in,” said the minister.
“We have always wanted to encourage more inward investment into the supply chain. It [fund] will be open to companies needing amounts of GBP50,000 to GBP1m.
“There is not an absolute cap and essentially it is for people who have difficulty accessing funding.”
Fallon noted there had been considerable interest in the UK Automotive Council and stressed the hard yards the British government had put in to secure the body’s status in the industry.
“There is probably a little bit of envy as to how Britain has done – we have worked at it,” said the minister. “UK Trade & Investment has worked at it extremely hard.
“We can’t produce GBP24m every day – it is public money – we have to go through various checks to make sure they create the jobs they say they are going to create.
“With [the] RGF, the National Audit Office looks to see how many jobs were created.”
