Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), said the Chancellor was right to set out measures to address the deficit while investing for future growth.
He said: “The automotive industry is a growth-driving sector, fundamental to the delivery of the country’s net zero ambitions. We therefore welcome the commitment of £2 billion of automotive transformation funding as part of the government’s modern Industrial Strategy.
“Delivering that strategy depends on the UK being globally competitive. Additional national insurance contributions will put massive pressure on the automotive supply chain which is predominantly SMEs. Next year’s spending review must find resources to fund measures that alleviate the strain on these companies and help them transition to an electrified future.
“A strong manufacturing sector depends on a strong market. The lack of substantive measures to support the new car market – in particular for electrified vehicles – is hugely disappointing. We welcome the extension of the Plug-in Van Grant and company car tax benefits, but these alone cannot drive the growth in demand needed.”
The extension of the Plug-In Van Grant was a key request with the Zero Emission Van Plan. A spokesperson for the plan, said: “The extension provides welcome relief to a sector facing an uphill battle to meet ambitious decarbonisation targets. Many van operators are seeking to kickstart their transition to zero-emission vehicles, with cost just one of the key barriers blocking their path. Extending the grant is a positive step but will not supercharge the transition by itself.”
David Wells, chief executive of trade association Logistics UK, also welcomed the freeze in fuel duty. “Nothing moves without logistics: the sector supplies our hospitals, schools, factories, shops and homes with everything they need, everywhere, every day,” he said.
“The sector is vital to any plans to stimulate growth across the economy and this respite is welcome news for a sector already seeing increasing business failures over the last year.”
Richard Smith, managing director of the Road Haulage Association (RHA), added: “With operating costs increasing and margins tightening, the last thing these vital businesses needed was a rise in fuel duty. We are pleased the Chancellor has listened to the concerns of our members.”
On roads investment, Smith added: “The continuation of work on major strategic roads – the A47, A57 and A75 – is welcome, but we are concerned about delays and cancellations to other significant road projects such as the Lower Thames Crossing and the A303 Stonehenge tunnel.”
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