Public finances in Britain may be tight, but the government has found some money to support new tech in the auto sector. As part of its Autumn Statement spending review, the UK government has said it will invest some GBP390m for future transport technology, including driverless cars, renewable fuels and energy efficient transport. This will include:
- GBP100m investment in testing infrastructure for driverless cars (autonomous vehicles, or AVs)
- GBP150m to provide at least 550 new electric and hydrogen buses, reduce the emissions of 1,500 existing buses and support taxis to become zero emission
- GBP80m to install more charging points for ultra-low emission vehicles
The support was welcomed by Mike Hawes, SMMT Chief Executive.
He said: "SMMT welcomes the government's commitment to improving infrastructure and investment in R&D, an area in which UK automotive punches above its weight.
"One of the main areas in which UK Automotive is playing a leading role is the development and introduction of low emission and connected and autonomous vehicles. The Chancellor's announcement of £390 million will help promote our competitive advantage in these fields. We welcome the investment to enhance the charging network for electric vehicles, as well as further support to boost uptake of low emission buses and taxis.
"These markets are still developing and it's critical the government continues to encourage this through consistent policies and investment. Furthermore, the commitment to connected and autonomous vehicle testing infrastructure is an area in which the UK is already one of Europe's leading centres. This commitment will help cement that position and promote this next generation technology, which has the potential to transform lives – preventing more than 25,000 accidents and creating more than 320,000 new jobs."
However, he expressed some disappointment.
"We are, however, disappointed that the government has not done more on business rate reform. SMMT called for the removal of plant and machinery from business rates valuation, which would have helped encourage further investment at this time of great uncertainty."
"While the Chancellor's focus on improving UK productivity is needed, the automotive industry bucks the national trend with the most productive workforce in Europe. What is required, however, are further measures to support competitiveness in the supply chain of both automotive and other key sectors."
The government also presented downward revisions for UK economic growth next year as a result of the Brexit vote. The UK economy is now forecast to grow at 1.4% in 2017, versus a previous forecast of 2.2%. Growth is forecast at 1.7% in 2018, 2.1% in 2019 and 2020 and 2% in 2021.
The UK government is also no longer seeking a budget surplus in 2019-20, but is committed to returning public finances to balance "as soon as practicable".