Motor sector is no longer such a joke

IN the Christmas Top Gear special, Jeremy Clarkson and co travel across India in a trio of clapped out British motors: an unreliable Jaguar, an ageing Rolls-Royce and an original Mini. The running joke is that Britain has little to offer the Indians – or anyone for that matter – in the way of cars these days.

But the UK is experiencing something of a renaissance when it comes to car manufacturing – and it is the very brands which appeared on Top Gear that are proving the key to its success. Last year, UK factories churned out 1.34m cars, the best performance since 2008 (itself a good year), and well above the dark days of the 1980s, when the industry was lucky if it produced 600,000 cars per annum. Nor is the number too far off the high water mark achieved in 1972, when production was 1.9m.

The figures only tell part of the story. It is not necessarily the number of motors that is important, but rather the types of car the UK is specialising in. High-end Jaguars, Range Rovers, Bentleys and Aston Martins are increasingly in demand in places like China, where the buyers still want them to be built in Britain. We also specialise in green cars, such as the Derby-built Toyota Prius, and new segments like the mini SUV (Nissan Qashqai) and luxury supermini (The Mini). Jobs building these cars are less likely to move abroad, because they command a high price (helping to pay for Britain’s high labour costs) and they are more specialised. This is the German model – BMW, Audi, Mercedes – not the French one. And it is by far the most resilient.

Improved labour relations have also helped immensely, as evidenced by the huge number of workers who agreed to a reduction in hours and pay when car plants shut down in the last recession.

Like others, I laughed my way through the Top Gear Christmas special – but Britain’s car industry is no longer such a big joke. david.crow@cityam.com