THE SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED PAGE 1

Tony Walker

Deputy Managing Director

Toyota Manufacturing UK

Business Environment and Skills Group Tony Walker, Toyota

SMMT Open Forum, 04 November 2014

Business Environment & Skills Working Group

To ensure that the UK automotive industry has the best business environment to operate in

• ‘A supportive business environment in the UK is critical to sustaining the competitiveness of the sector and as the first choice for investment.’ Automotive Sector Strategy (July 2013) • Automotive Council created additional BE&S Working Group

• Technology Group – Encouraging R&D investment & collaboration on sticky technologies in UK

• Supply Chain Group - Strengthening the supply chain in the UK • Business Environment & Skills Group - Securing a business environment

that enables a competitive automotive industry in the UK

Automotive Sector Strategy (July 2013)- Business Environment & Skills Group

Business Environment & Skills Working Group

To ensure that the UK automotive industry has the best business environment to operate in

Skills

Chair: Jo Lopes,

JLR

International Competitiveness

Chair: Tony Walker,

Toyota

UK Business Environment

Chair:

James Stephens, Nissan

Europe

Chair: Andrew McCall,

Ford

Business Environment & Skills Group

Chair: Nigel Stein,

GKN

Business Environment & Skills

Working Group

Business Environment & Skills Achievements

• Successful Industrial Partnership EOP bid to address skills needs

• LEP leadership forum established to engage with Local Enterprise Partnerships

• Strong two-way dialogue between the automotive industry and government

New working group, but activity is already progressing at some speed

Skills Workstream

To ensure the UK automotive industry can support and develop the skills needed for sustainable success

Established with Automotive Sector Strategy - July 2013

Vision

• Ensure UK workforce has skills to support growing, increasingly technology focused, automotive sector • Industry in partnership with the Government will address urgent skills needs and develop a comprehensive talent pipeline for the sector

Priorities

- Consensus Automotive Skills Road map - Industrial Partnership (Employer Ownership) bid - Other Industrial Strategy skills action

Recruit more than 7,600 additional apprentices and 1,700 additional graduates over the next five years (till 2018)

Since March 2014:

Trailblazers delivering/

developing standards

Consensus skills roadmap

Create an Automotive Council scholarship scheme

Get top executives from the industry to personally engage with schools and their students

Explore options to widen availability of the modular Masters Degree Advanced Skills Accreditation Scheme

Other Work Group Priority Actions

Provide a “job family” view of

career opportunities in the

Automotive industry

DRAFT - MARCH 15

Provide roadmaps for career

progression & leadership in

Automotive industry based on

job families and descriptions

DRAFT - SEPTEMBER 15

Create new job descriptions and

codes created to support new

growth technologies

DRAFTS - FEBRUARY 16

Industrial Strategy Skills Actions Key pieces of work & milestones

Implement consensus automotive skills roadmap

Ongoing

Deliver the Automotive Industrial Partnership Employer Ownership of Skills (EOP) bid Automotive Skills Fund - £1m to support IP Infrastructure element Participation programmes - Traineeships, problem solving training, Maintenance Leadership, Meister Pruefung programme development and conversion up-skilling training

Automotive Industrial Partnership (IP) bid approved

Start delivery & communication -Progress IP contracting, establish the work stream teams and finalise bid content. -Finalise set up of Automotive Skills Fund £1m to support IP infrastructure element -Start IP participation programmes

Continue to participate in the next phase of See Inside Manufacturing

See Inside Manufacturing –October 2014 - Approx. 15 automotive companies engaged in initiative

Other skills deliverables AC scholarship programme, school & university engagement, Masters Advanced Skills Accreditation Scheme, careers advice

Ongoing

Progress to date S

kill

s

UK Business Environment Workstream

Driving strategic engagement with Local Enterprise Partnerships & supporting early market for ULEV’s

Established in Q4 2013

Vision

‘The Automotive Council will improve strategic interaction with the key automotive LEPs, devolved partners and other local decision makers, bringing them together with members of the full Council

twice a year to determine strategic priorities for local and regional implementation of the national strategy.’

Priorities

- LEP Leadership Forum - Ultra Low Emission Vehicles - Air quality - Intelligent Mobility

Local Enterprise Partnership (LEP) Leadership Forum - LLF

• Established January 2014

• 16 key LEPs with automotive footprint & vision

• Meets twice a year, plus specific meetings

• Strategic sector link to LEPs

– Implementation of sector strategy at local level

• Providing local input into national strategy

• Shaping local offer and funding priorities

• Overview document - One page summaries of key LEPs

LEP Leadership Forum

Next steps

LEP Leadership Forum (LLF) Nov 2014 – Meeting on skills/IP Jan 2015 – Next full LLF meeting

- Publish LEP one pager document - Develop 2015 work plan - Seek input from Devolved Administrations

Ultra low emission vehicles (ULEVs)

Continue to support the early market for ULEVs

- Finalise ULEV paper in discussion with OLEV and BE&S group

Air Quality

Develop Automotive Council position on

air quality

- Establish Air Quality subgroup

- Develop Air Quality paper

Intelligent Mobility

Review regulatory environment

- Establish Intelligent Mobility subgroup

- Develop Intelligent Mobility paper

- Ensure links with Technology Group

Europe Workstream

Assess state of EU relationship & identify improvement opportunities on engagement, regulation & trade to support the UK auto sector.

Established in December 2013

Vision

‘Maintaining proactive engagement with the European Union’

‘Continued access to the Single Market ‘Influential voice in the development of regulations’

‘Supporting key free trade agreements to boost exports’

Priorities

- Develop status report on UK-EU Auto Industry relationship - Improve UK engagement with EU institutions & processes - Develop EU regulatory reform proposals - Support key free trade agreements

Better engagement in Brussels

EU is a key part of UK business environment

• Automotive Sector Strategy (July 2013)

Strong industry narrative on Europe

• SMMT KPMG Europe report (April 2014)

Need for better industry / government collaboration

• To maximise UK opportunities & influence in EU

• Narrative – Engagement – Priorities

• Industrial policy, EU regulatory reform, Trade

Next steps

Status report on UK-EU Auto Industry relationship

- Develop common narrative on areas of agreement between industry and Government: Industrial policy, EU regulatory reform and trade policy

UK/EU institutional engagement - Workshop on post-2020 CO2 discussions as test case for early Government & industry engagement

Develop reform proposals for UK/EU Institutional engagement

- Discussion paper on EU engagement & influencing along common narrative

EU regulatory reform proposals

- Develop regulatory reform proposals

- Feed into BIS EU Growth team & Better Regulation Executive

UK International Competitiveness Workstream Produce a weighted numerical scorecard with accompanying narrative and case studies to illustrate specific areas of importance to UK automotive

Established end March 2014

Vision

“partnership between Government and the Industry”

“…become the most competitive place in Europe for manufacturing, R&D, inward investment and re-shoring”

“track and monitor our performance, showcase the UK’s strengths, and provide quick and relevant information in advance”

Objective

1) Objective set of KPIs to guide industry and government on positive factors we must maintain, and negative factors we need to improve

2) Develop a set of “killer facts” to demonstrate the UK’s competitive advantages to key decision makers

UK International Competitiveness Workstream Produce a weighted numerical scorecard with accompanying narrative and case studies to illustrate specific areas of importance to UK automotive

Progress to date • Workstream members (OEMs; suppliers; BIS; SMMT) meeting regularly to confirm

content of matrix • Competitor countries & main KPIs identified and agreed – source for majority of KPIs

identified

Manufacturing

competitiveness

R&D

competitiveness

Business

environment

Industry

environment

Extent that UK is a competitive

location for producing vehicles

engines & parts

Extent that UK is a competitive

location for doing / localising

R&D

General attractiveness of the UK

as a place to do business in

automotive

Health of the UK automotive

sector – result of sector strategy

• All EU countries with >500,000 vehicle annual production

• All countries producing > UK • BRIC & MINT countries • Selection of new EU entrants • S Africa; Australia

EU15 Germany

Spain

France

Italy

EU- NEW Czech Republich

Slovakia

Poland

Romania

Bulgaria

Other Europe Russia

Turkey

Asia-Oceania China

India

Japan

South Korea

Thailand

Indonesia

Australia

Americas US

Brazil

Mexico

Canada

Africa Nigeria

South Africa

Countries KPI categories

Basis: Competitors and KPIs which used by business for investment decisions

Developing concrete recommendations to government

Development of clear and convincing evidence-based narrative

UK International Competitiveness Workstream Produce a weighted numerical scorecard with accompanying narrative and case studies to illustrate specific areas of importance to UK automotive

Next Steps

Confirming the KPIs are the right ones to track Cross-checking to a wide range of

companies’ sourcing policies

Weighting the KPIs according to importance for investment decisions

(Capacity increase / R&D / new plant etc)

Using real case studies to confirm real world importance

Business Environment & Skills Working Group

Thank you