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How the EU funds innovation in the UK automotive industry – Part Five

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This is the final in a five part series about the UK automotive industry and its role within the EU. To read the previous articles, click the relevant links below.

Part One – The UK Automotive Industry in the EU
Part Two – The EU as an Export Market for the Automotive Industry
Part Three – The Power of the Scale of the EU in Trade Negotiations
Part Four – EU Regulation in UK Industry

The UK automotive industry is at the forefront of innovation – the fact that over eight Formula One teams choose to base their operations here is testament to that fact.

However, innovation cannot happen without the funding to support it, and to date, the EU has provided over €50.6 billion worth of funding to the automotive industry in Europe through their initiative, FP7 (Seventh Framework Programme for Research and Technological Development)

FP7 is being succeeded by a new initiative, Horizon 2020, which is the biggest EU research programme so far, with nearly €80 billion available between 2014 and 2020. In order to get access to this funding, Great Britain must remain part of the EU.

So where is Britain most innovative? Well, with the likes of the Ford Ecoboost engine hailing from England, it should come as no surprise that the European Green Vehicles Initiative is a key focus for UK manufacturers. The growing focus on low emissions, and even zero emissions vehicles, is worldwide, and the potential for the UK to grow its share in this sector is huge.

Take, for example, Japanese manufacturer Nissan’s decision to site the European production in Sunderland. This was accompanied by a brand new battery plant built next to the car assembly plant. The success of the Nissan Leaf is incredible, with overr 100,000 sold worldwide since 2010, making it the best selling electric car globally.

Innovation quite literally drives the automotive industry, and funding can be difficult to come by, especially if you are not part of larger governmental bodies, such as the EU. The funding goes much further than just paving a way for research – that research leads on to new contracts from manufacturers, which in turn provides more jobs, therefore stimulating the economy – the ripple effect goes on.

Throughout this series, I’ve discussed the various ways in which the UK automotive industry both benefits and is limited by the EU. In many arguments to leave the EU, politicians cite the strict regulations which can stifle the industry – and whilst this is true, the discussion is by no means at an end. The multiple benefits of staying part of the free market are evident – it helps international trade, stimulates the domestic economy and allows the movement and development of key skills (such as engineering and design.) Britain is home to some huge manufacturers – Vauxhall, Nissan, and Ford to name a few. However, these are all companies who are established and governed from elsewhere. Everyone recognises the need to support the small British marques – many of which produce less than 10,000 cars a year, and consequently struggle when new, more restrictive EU regulations are bought in. For this reason, it would seem that in order to continue working with the EU whilst simultaneously taking care of our British companies and industry, there needs to be a change in the way that the EU regulates the automotive industry as a whole.

We want to know how changing our relationship with the EU could affect either you, or your company – leave us a message in the comments!

All opinions are my own, and do not necessarily represent those of Creditplus, or its affliates.

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