Getting a deal must be next PM’s first job urges SMMT

The Society of Motor Manufacturers and Traders (SMMT) has issued a plea to the UK’s next prime minister to secure a favourable Brexit deal as his number one priority on taking office. The call came as the trade body published a new report highlighting the importance of automotive trade to the UK economy and the high stakes of a ‘no deal’ Brexit. SMMT’s 2019 UK Automotive Trade Report calculates that delays to production caused by friction at the border could add up to £50,000 a minute for the sector.

Leaving the EU without a deal would trigger the most seismic shift in trading conditions ever experienced by automotive, with billions of pounds of tariffs threatening to impact consumer choice and affordability. The end to borderless trade could bring crippling disruptions to the industry’s just-in-time operating model. Delays to shipments of parts to production plants are measured in minutes, with every 60 seconds costing £50,000 in gross value added – amounting to some £70 million a day in a worst case scenario.

Combined with WTO tariffs, which for trade in passenger cars alone amount to £4.5 billion a year, this would deliver a knockout blow to the sector’s competitiveness, undermining a decade of extraordinary growth.

Thanks to the free and frictionless trade afforded by the customs union and single market, automotive trade value has risen by 118% since the global financial recession, from £47 billion in 2009 to £101 billion last year. Over the same period, car production increased by more than half, with more than eight in 10 vehicles bound for export – the majority to the EU. 3.3 million new cars are traded between the UK and EU each year, while the UK exports some £5.2 billion worth of components and £2.9 billion of engines to help build vehicles across the continent.

Addressing an audience of business leaders and government officials at the industry’s annual International Automotive Summit in London, Mike Hawes, SMMT chief executive, said, “Automotive matters to UK trade and to the economy, and this report shows that, if the right choices are made, a bright future is possible. However, ‘no deal’ remains the clear and present danger. We are already seeing the consequences of uncertainty, the fear of no deal. The next PM’s first job in office must be to secure a deal that maintains frictionless trade because, for our industry, ‘no deal’ is not an option and we don’t have the luxury of time.”

Automotive is the UK’s single biggest exporter of goods, trading with some 160 countries worldwide, and accounting for more than 14% of total exports. The sector is one of the country’s most valuable economic assets, directly employing 168,000 people,2 supporting communities and delivering an annual £18.6 billion to the public purse. Leaving the EU without a deal would jeopardise this, hampering government’s ambitions to boost global exports and GDP. Without automotive, the UK would lose its hard-won status as the world’s 10th biggest exporter of goods, falling to 14th place behind Belgium, Canada, Mexico and Russia.

However, the report also calculates that the right deal, backed up by ongoing collaboration to create a competitive business environment and thriving market, and combined with an ambitious automotive-focused trade strategy, could trigger a 20% uplift in the industry’s global trade value – worth £20 billion, if the sector can maximise its full capacity.

SMMT’s first-ever UK Automotive Trade Report charts the rise of the sector over 40 years, outlining current and future challenges and opportunities for trade with Europe and globally. It sets out clear set of recommendations to government and industry to help boost competitiveness, promote frictionless trade with existing markets and unlock new business between the UK and key export destinations around the world.

Eight recommendations for government and industry

  • Set a positive, modern, automotive-friendly trade agenda and exercise thought leadership in shaping national, regional and global trade rules applicable to new-generation vehicles and automotive technologies
  • Ensure no new barriers are introduced to trade between the UK and EU, as well as maintaining existing trade terms for preferential access to major markets beyond the European regions, while also working to diffuse international trade tensions
  • Strengthen engagement with industry and ensure trade policy and automotive specialists are part of senior management and negotiating teams
  • Seek new trade opportunities in key global markets, through the removal and reduction of tariff and non tariff barriers
  • Remain at the forefront of global automotive rule making, preserving the UK’s role in UNECE discussions and increasing the UK’s efforts to bridge gaps between regulatory superpowers and reduce regulatory barriers
  • Collaborate with industry to enhance the domestic customs system to ensure legitimate trade does not face costly delays and invest in physical and digital infrastructure and incentives that promotes non-burdensome trade and assists with up-skilling of suppliers
  • Foster trade promotion by helping UK companies to explore distant and risky markets, and continue to support international events to raise the UK’s profile and open up opportunities
  • Link trade and industrial strategies and investment plans to ensure the UK’s strategic interests in a strong, modern and innovative automotive sector are prioritised and sustained by future policies.

Your Comments

Government consultation on banning tyres aged 10 years and older

A consultation has been opened on a proposed ban on tyres aged 10 years and older from heavy goods vehicles, heavy trailers, buses, coaches and minibuses.

This consultation will remain open for ten weeks, closing at 11:45pm on 1 September 2019.

The Department for Transport is seeking views on a proposed ban on tyres aged 10 years and older from certain vehicle types, to improve road safety. The intention would be to introduce regulations that ban the use of tyres aged 10 years and older from:

  • heavy goods vehicles
  • heavy trailers
  • buses, coaches and minibuses

The DfT and DVSA are also seeking views and evidence on whether to introduce a similar maximum age for tyres fitted to taxis and private hire vehicles.

Anyone wishing to make a submission can do so either online or by downloading and completing a form. For full details, CLICK HERE.

Your Comments

Broad new measures to ensure small businesses get paid on time

For the first time large businesses could be fined for failing to pay smaller suppliers on time as part of a robust package of measures unveiled by Small Business Minister Kelly Tolhurst.

Company boards will now be held accountable for payment practices to small businesses within their companies in a drive to increase transparency and accountability on late payments. Measures will force Audit Committees to report payment practices in company annual reports.

The government will consult on strengthening the powers of the Small Business Commissioner to hold to account the minority of larger businesses who fail to make payments on time. New powers could include compelling information and disclosure of payment terms and practices, imposing financial penalties or binding payment plans on large businesses found to have unfair payment practices.

Responsibility of the voluntary code of best practice – the Prompt Payment Code – will be moved to the Small Business Commissioner. This will put tools to tackle late payment under one organisation, ensuring the Commissioner has the powers to affect culture change in unfair payment practices.

Small Business Minister Kelly Tolhurst said: “The vast majority of businesses pay their bills on time, with the amount owed in late payments halved over the last five years. But as a former small business owner, I know the huge impact a late payment can have on the ability of a small business to plan, invest and grow.

Small businesses are the backbone of our economy and through our modern Industrial Strategy we want to ensure the UK is the best place to start and grow a business. These measures will ensure that small businesses are given the support they need and ensure that they get paid quickly – ending the unacceptable culture of late payment.”

Other proposals include:

A tough new approach to large companies which do not comply with the Payment Practices Reporting Duty – an existing mandatory requirement on large businesses to report payment practice to a national database twice a year. The legislation allows for the prosecution of those which do not comply, and fines may be imposed. The government will consult on giving these powers to the Small Business Commissioner.

A Business Basics Fund competition of up to £1 million in funding to encourage businesses to use technology to simplify invoicing, payment and credit management to ensure they work as effectively as possible.

Mike Cherry, National Chairman of the Federation of Small Businesses, said: “Small businesses will be delighted with today’s announcement. FSB has worked very hard with government to create a whole-board approach to late payment within the UK’s large companies, and empower Audit Committees to look after the supply chain. Together with measures to strengthen the Small Business Commissioner’s powers and reform the Prompt Payment Code, the measures today could finally see an end to poor payment practice. Changing our business culture will boost the small business community, productivity and growth.”

Small Business Commissioner Paul Uppal said:  “During the first 16 months of my post I have been struck by the trepidation felt by small businesses when talking about late payment with their large suppliers.

The government has a range of measures in place to tackle late payment and this consultation is a further step in the right direction to protect and support small businesses.

I welcome any additional provisions which will strengthen the influence my Office has in tackling poor payment practice and levelling the existing playing field.”

Philip King, Chief Executive of the Chartered Institute of Credit Management said: “We welcome this announcement and in particular the proposal to bring the Prompt Payment Code under the auspices of the Small Business Commissioner in a managed transition.

We will continue to work closely with the Commissioner and the government in supporting small businesses and driving cultural change and look forward to engaging with existing signatories and wider stakeholders in shaping the best practice principles of the future.

This ambitious package of measures will level the playing field for the UK’s 5.7 million small businesses, delivering on the modern Industrial Strategy’s ambition to make Britain the best place to start and grow a business. Ending the culture of late payments will pave the way to boost SME productivity, remove barriers to growth and improve cash flow.”

The Small Business Commissioner’s Office was set up by government in 2017 to tackle the issue of late payments. It has already recovered over £3.8 million and more powers will enable it to tackle this unacceptable culture and do more to champion businesses across the UK.

Your Comments

TMD Friction appoints new group CEO and president

TMD Friction has announced that effective from 1st August 2019 David Baines will be appointed as TMD Friction group CEO and president, replacing current CEO Mr. Tetsuya Kumakawa, who will leave TMD Friction and be appointed at a senior management position inside parent company Nisshinbo Group.

David Baines has more than 30 years’ experience inside TMD Friction across a variety of management roles and disciplines, and has accumulated extensive knowledge of the global automotive market.

During the last 15 years of his career with TMD Friction, David Baines has held a variety of customer facing roles from regional management to strategic planning and global marketing, and for the last five years has held the overall worldwide responsibility for the independent aftermarket business unit inside TMD Friction.

Your Comments

DVSA to use ANPR cameras to target dangerous drivers

The Driver and Vehicle Standards Agency (DVSA) will use Automatic Number Plate Recognition cameras to target drivers who break the law in a trial that will run until April 2020.

It will combine ANPR data with specialist analysis and intelligence to enforce a range of offences, including MOTs on cars and light goods vehicles; drivers’ hours offences; tachograph manipulation; and learner driver and instruction offences.

DVSA director of enforcement Marian Kitson said: “DVSA’s priority is to protect everyone from unsafe drivers and vehicles.

“We have some of the safest roads in the world but we are determined to do more to tackle those drivers who flout the law and endanger people’s lives.

“By trialling the use of the existing ANPR camera network, we are looking at how we can tackle illegal and dangerous drivers who put people’s lives at risk every day.”

With the evidence that ANPR data provides, offences will be more effectively detected, disrupted and deterred through fixed penalties, regulatory action from Traffic Commissioners, and even prosecutions, it said.

DVSA hopes that by punishing those who chose to be non-compliant, it helps ensure that they do not prosper over compliant operators.

The potential use of the ANPR system by DVSA was first highlighted earlier this year. It had decided against investing in expensive equipment to read new smart tachographs remotely and said it was considering using the ANPR network.

Smart Tachographs, which become mandatory in all new registrations from June 15, herald a new era in the fight against lorry drivers driving when fatigued.

They are able to record the truck’s position when the driver starts his or her shift, then after every three hours of accumulated driving time.

They will also note the truck’s location at the end of the shift. The records will be expressed in terms of latitude and longitude and will be accurate to one-tenth of a minute.

A record is kept regardless of whether a digital tachograph card has been inserted or not. If it shows that a truck has arrived at point B having been at point A three hours previously and there is no evidence of the tachograph having been operated and a card used by whoever was behind the wheel, then questions are likely to be asked by the enforcement authorities.

Your Comments

K&S McKenzie deliver a showcase with a difference at Thirsk Truck Gathering

Thirsk Truck Gathering, held in North Yorkshire, celebrated its 7th annual event this year with visitors from across the country attending to see some of the best trucks in the country, all whilst enjoying the numerous food and trade stands on offer.

This year, Cumbrian motor factor K&S McKenzie’s stand stood out for all the right reasons with their new monster truck, dubbed #McKenzieMonster, on display. The team at K&S McKenzie will be taking the monster truck to a number of shows and events cross the country this year with the aim of raising money for local charities. The truck’s debut show appearance at Thirsk Truck Gathering was a success and raised money for the charity Brining Back a Smile.

Bringing Back a Smile’s focus is to raise funds for adults and children with life-threatening illnesses throughout the North/East, with the aim of giving them and their family a break away from the gruelling treatment they have to undertake on a daily basis. K&S McKenzie wish to thank everyone who donated on the day and encourage anyone who sees #McKenzieMonster at an event this year to pay and visit and donate!

Your Comments

Eminox celebrates 5,000 fitment

Emissions reduction specialist Eminox Limited has reached a major milestone with more than 5,000 fitments.

The 5,000th SCRT system was provided to Arriva London as part of its project to upgrade over 700 buses ready for the introduction of ULEZ.

Eminox SCRT systems are proven to reduce NOx and NO2 by up to 99%, and particulate matter by up to 95%, in real world urban operations.

Mark Runciman, managing director of Eminox, said, ‘Having over 5,000 buses fitted with our SCRT retrofit system is a fantastic achievement and we are thrilled it is in on a TfL vehicle.’

Eminox’s expertise and dedication to retrofit systems, when other companies have backed out of the market, has proven to build trust within the industry. The company was first to be approved by the Clean Vehicle Retrofit Accreditation Scheme (CVRAS).

Carlos Vicente, retrofit sales director for Eminox, said, ‘Fleet operators have a number of choices when it comes to operating in clean air zones, but financially it’s clear Euro VI retrofit is the most economical path to becoming compliant at the fraction of the cost of buying a new vehicle.

‘The number of operators considering our Euro VI retrofit technology continues to grow as it means they can comply with London ULEZ and the ever-growing national CAZ requirements. We design and manufacture our products in the UK, which provides reassurance in the quality and consistency of our systems and that we’re here to offer long term service and support.’

Your Comments

TEMOT honours TecAlliance with ‘Data Information Excellence’ award

At its international supplier conference in Barcelona, Spain, the international trade cooperative TEMOT International honoured TecAlliance with a prize in the newly introduced ‘Information Data Excellence’ category.

“We’re extraordinarily happy to receive this award. Data is our passion, and the introduction of this new award category demonstrates how important data is for value creation in the automotive aftermarket. We are proud of the fact that this prize appreciates our longstanding commitment to the highest level of data quality, the establishment of a globally valid standard and the digitisation of business processes”, says TecAlliance CEO Jürgen Buchert.

“TEMOT International is celebrating the 25th anniversary of the trade cooperative this year, while we are also celebrating a 25th anniversary this year. We introduced the TecDoc Standard in 1994 in order to provide for the comparability, efficiency, transparency and quality of product data in the global automotive aftermarket. Today, the TecDoc Standard stands for the highest level of data quality in the global motor vehicle spare parts market. Tomorrow, it will be the basis for the development and implementation of intelligent applications for the mobility concepts of the future”, explains Jürgen Buchert.

The international trade cooperative’s ‘Annual Spring Meeting & Executive Suppliers’ Event’ once again brought together hundreds of top managers from TEMOT shareholders, suppliers and service providers, where it provided an exclusive framework for the exchange of views on market trends and future prospects in the automotive aftermarket. In addition to the presentation of the established and prestigious Performance Awards for TEMOT suppliers, this year saw the presentation of the first-ever award in the field of ‘Information Data Excellence’.

Your Comments

The Parts Alliance events experience contrasting weather conditions

The Parts Alliance Midpoint distribution centre opened its doors for garage customers recently, attracting a total of 250 attendees including 25 key suppliers.

The open evening, held on Thursday 13 June had originally been intended to take place at GSF Birmingham but was moved to Midpoint to involve eager customers of local branches of CES and Bromsgrove Motor Factors as well as those of GSF.

Guests were given tours of the distribution centre and, undeterred by the weather, were treated to a BBQ courtesy of Schaeffler’s LuK brand.

Dean Whitehouse, head of business development at The Parts Alliance, said: “It was an amazing night.

“Wonderful to see so many customers make the effort in the awful rain.

“We had a hundreds of customers coming to see our new warehouse and spend time with our branch staff.”

Simon Moore, head of marketing at The Parts Alliance, said: “Despite atrocious weather, we had an unbelievable turnout and really showed the loyalty of our customers to make the effort through the floods.

“It was wonderful to see so many. I’d like to thank our suppliers and staff for putting together a great open evening.”

In contrast, the sun was shining as hundreds of The Parts Alliance’s customers attended the company’s summer trade show at Brighton race course on Thursday 20th June.

Guests included representatives from nearby branches, as well as over 40 leading suppliers, who enjoyed food and drink as they mingled with special guest, BTCC driver Matt Neal.

Alongside exclusive show offers, attendees had the chance to win great prizes, courtesy of The Parts Alliance’s suppliers. To be in with a chance of winning, guests had their ‘prize card’ stamped as they made their way around the supplier stands.

The evening event was held to showcase the significant investment that The Parts Alliance has made in its local CPA branches, including over £1m in stock.

Some of the beneficiaries include CPA Chichester, which has benefited from a stock investment of 500% in its new location, and CPA Hove and CPA Lewes have now moved to larger, two tier premises to offer better availability.

This investment comes in addition to the new 500,000 sq.ft. National Distribution Centre and new Regional Distribution Centres, which The Parts Alliance says will improve customer service, availability and delivery throughout the network.

Simon Moore, Head of Marketing at The Parts Alliance, commented: “The feedback we’ve had from our guests has been overwhelmingly positive, and our suppliers really appreciated the chance to trade and network.”

Your Comments

Parental Bereavement (Leave and Pay) Act 2018

The legislation has now received royal assent. The act provides a day one right for employees to take two weeks parental bereavement leave following the death of a child under the age of 18 or if they suffer a stillbirth from 24 weeks of pregnancy.

Employees will also be able to claim statutory parental bereavement pay if they meet the eligibility criteria. One of the requirements is to have at least 26 weeks continuous service with their employer.

The legislation is expected to come into force in April 2020 once implementing relation have been made setting out further details of the provisions. These regulations will include a requirement that the leave must be taken within 56 days of the child’s death. It’s yet to be confirmed but it is anticipated that the parental bereavement pay will be at the statutory flat rate (currently £148.68) or 90% of average weekly earnings if lower but this is yet to be defined in the implementing regulations.

Your Comments