The manufacturing sector has broadly welcomed the Government’s recent Advanced Manufacturing Plan. With its focus on the global transition to net zero, this plan could not have been more timely as talks at the COP28 Climate Change conference are underway. It is heartening to see the UK step up to meet other countries and regions across the world, including US and EU, who already have ambitious industrial strategies in place to move the dial on energy transition.
What’s more, our latest Reshoring Index indicates the UK has become increasingly reliant on overseas manufacturing in the past four years. The Government’s £4.5 billion commitment to the sector announced in the Autumn Statement provides much-needed support to reverse the decline and make manufacturing central to economic growth. Within this, the Advanced Manufacturing Plan establishes renewables and the electrification of the automotive sector as providing significant opportunities to cement the UK’s position as a world-leader in sustainable manufacturing and turbocharge the economy.
The question is, what happens next?
Journey to net zero requires radical change
In order to transition to sustainable energy sources, we must prioritise the development of hydrogen, nuclear and other renewables. For hydrogen, the UK’s access to offshore wind and our technical expertise means we’re well-placed to lead the way. However, it’s clear that infrastructure is needed to support production, storage and distribution. Furthermore, new research and manufacturing techniques are also required if the UK is to be a front runner in scaling-up its use as an energy source on a global scale.
In addition, to achieve net zero, fast and substantial investment in UK-based supply chains for green energy-based industries is needed. This will ensure that economic opportunities associated with these sectors are not outsourced overseas and, as a result, the UK can effectively safeguard energy security and economic growth. For this to happen, a UK green financing facility is required from the banking sector, potentially in partnership with Government, to provide affordable financing in addition to making ‘full expensing’ permanent. This will ensure we can adopt the latest technologies, make our supply chains more productive, resilient and competitive and, ultimately, support the country’s journey to net zero.
Defining moment for UK EV production
The drive to scale-up electric vehicle production is another area which carries a significant opportunity for our manufacturing industry as well as contributing to the UK’s economic resilience. Some progress has been made, with Envision building a £450m plant in Sunderland, and Tata pledging £4bn to build a plant in the South West. In addition, Aston Martin is pushing ahead with its electrification strategy; the carmaker is working with a number of partners including the MTC to develop its luxury battery electric vehicle platform, supported by Government funding awarded through the Advanced Propulsion Centre1.
However, much more must be done to meet demand, and investment needs to accelerate, with the West Midlands Gigapark Investment Zone offering huge potential, alongside other possible opportunities across the UK. Transformations of the auto manufacturing plants and associated supply chain re-shoring is critical to the auto industry’s future viability.
Skills development underpins advanced manufacturing ambitions
With skills shortages continuing to burden industry, we can’t begin to address these productivity and innovation challenges without first looking at our people. A major multifaceted reskilling programme is required across the country, focusing on net zero technology capabilities and digital fluency. An emphasis on recruitment, retention and strategic upskilling of the existing workforce will be key in ensuring the future needs of industry are met.
A futureproofed workforce, coupled with support from technology and innovation centres such as the High Value Manufacturing Catapults, including the Manufacturing Technology Centre, provides industry with the experience and expertise to connect the dots between academic research and commercial reality. This means we have the ability to significantly enhance the impact and scope of R&D projects, so that innovations can be commercialised here in the UK.
Economic growth will be the litmus test for the Government's Autumn Statement and Advanced Manufacturing Plan. Organisations will benefit from enhanced opportunities for innovation and collaboration, enabling UK manufacturing to stand out on the global stage in addressing energy transition. The commitments made in the plan is a call to arms for UK manufacturing and we must seize the opportunities that lie ahead.
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