UK government backing for supply chain companies is encouraging foreign direct investment (FDI) into companies such as plastics manufacturer, Nifco, says Business Minister, Michael Fallon.
FDI is a key objective of the UK government-funded Automotive Investment Organisation (AIO), which says it has already secured GBP457m (US$778m) of business for British companies.
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“Sixty projects from the automotive sector are receiving Regional Growth Fund (RGF) support,” said Fallon at yesterday’s Society of Motor Manufacturers & Traders (SMMT) ‘Meet the Buyer’ event in London’s docklands area.
“[Plastic parts producer] Nifco UK based in Teeside developed some plastic components – the RGF allocated Nifco GBP3.5m that will see them create nearly 300 jobs and 17 apprenticeships.
“It was that funding that persuaded their Japanese parent to invest here. That is great news for us in the UK and will ensure there is increased demand of the supply chain.”
The Business Minister – who also unveiled a GBP24m Tooling Funding Programme at the event – hailed the work of the Advanced Manufacturing Supply Chain Initiative (AMSCI) and insisted on the crucial nature of the UK production industry.
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By GlobalData“A strong manufacturing sector is vital to a balanced economy,” said Fallon. “It is not enough for large companies to be located here – we want them to be increasing sourcing their supplies from SMEs here in the UK.
“We will continue to support businesses to secure more highly skilled jobs.”
The Tooling Funding Programme looks to address a key challenge for many in the automotive sector – namely finding finance even if they can demonstrate they have secured contracts in some cases.
“One of the priority issues for the industry has always been access to finance,” said Fallon. “It is particularly important for the supply chain. Without tooling finance, the supply chain cannot support vehicle manufacturing growth and production is likely to go abroad.
“The GBP24m will fund the design, development and manufacture of tooling or the expansion of tooling capacity.
“We expect a lot of interest in this programme. Support is also available for companies wishing to export to new markets.”
General Motors recently announced some 40% of the new Vivaro would be sourced in the UK.
