March 28, 2013 3:30 pm

UK electric car profile shifts up a gear

The profile of electric cars in Britain shifted up a gear on Thursday, with the start of production on the first all-electric car to be built in the UK: the Nissan Leaf.

Mass production of the 100 per cent electric Leaf, which began at Nissan’s Sunderland plant, is the culmination of four years of preparation and £420m of investment at the site.

David Cameron, prime minister, visiting the plant, said the start of Leaf production was “the best possible rebuke” to those who said Britain could no longer design, make and export products.

“Yes, we have great financial services, yes, we have great creative industries, but we are also one of the top ten manufacturing countries in the world”, he said. “We produce great cars; we have recently been net exporters of cars, we are producing record numbers of cars. and we are about the cars of the future, producing new electric cars.”

Mr Cameron said he wanted a rebalanced UK economy less reliant on financial services and better spread across the country.

Britain’s car industry has shown incredible resilience, he said, growing during a difficult period. He noted that Nissan’s is the most efficient car plant in Europe and one of the most efficient in the world.

Asked if government departments might consider using the all-electric leaf, he said there were “conversations under way” on this.

Nissan, Japan’s second-largest automotive company, described the start of Leaf production in Sunderland as the “dawn of a bold new era”.

Until now, electric car take-up has been relatively low in the UK. According to figures from the Society of Motor Manufacturers and Traders (SMMT), total UK registrations of grant-eligible plug-in vehicles in 2012 numbered 2,237 – of which 1,262 were pure electric – out of more than 2m registrations in total.

As a result, Leaf production has been focused on Japan and the US.

Nissan has sold 7,000 Leafs across Europe, out of a total global sale of more than 55,000. It could make 50,000 a year at Sunderland but will align output to sales. The Sunderland plant is also making advanced lithium-ion batteries.

The Sunderland plant has been in the vanguard of the recent upturn in fortunes of the UK’s automotive sector, in contrast to stalled or falling output in continental Europe. In 2012, the plant produced 510,572 vehicles, making it the first UK car factory ever to exceed 500,000 in one year. Its maximum annual capacity is 570,000.

The Sunderland site – now a £3.5bn investment that has made more than 7m cars since its opening in 1986 – employs 6,100 people. Leaf production and the battery plant are supporting more than 2,000 UK car industry jobs, including more than 500 directly at Nissan.

Welcoming the start of Leaf production as “a landmark day” for the UK automotive industry, the Confederation of British Industry (CBI) said the UK now has one of the most diverse and productive automotive industries in the world. It noted that UK carmakers had attracted more than £6bn of inward investment in the last two years, generating around £30 billion of annual export revenue for the UK economy.

Nissan’s announcement comes on the same day that a new CBI report highlights the long-term growth potential of the UK automotive industry, but a need to address skill shortages, strengthen the supply chain and improve access to finance.

The SMMT said the start of Leaf production at Sunderland would make electric cars more visible for UK consumers. “For awareness and ramping up of consumer uptake, it’s a significant moment.”

The UK government, which offers a plug in car subsidy of up to £5,000 a vehicle, has recently taken further steps to boost the market. Last month, it announced a £37m investment into the UK’s electric vehicle charging infrastructure, including a 75 per cent contribution to home charging points.

Last week’s Budget boosted the attraction of electric vehicles as company cars by announcing that benefit in-kind tax levels on EVs from April 2015 will be 5 per cent, rather than the previously announced 13 per cent.

• One hundred years to the day since William Morris built the first “Bullnose” Morris Oxford, a centenary exhibition will be opened on Thursday at the modern Mini plant’s Oxford visitor centre, by Patrick McLoughlin, transport secretary and Harald Krueger, board member of BMW AG.

From a weekly production of 20 vehicles in 1913, the business grew rapidly. Over the 100 years, the Oxford plant has produced 11.66m cars including more than 2.25m Minis. Since 2001, 1.7m new Minis have been exported to 107 countries.

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