The UK will lose out in the race to become an electric vehicle production leader unless the Government provides urgent backing for the sector, the Society of Motor Manufacturers and Traders (SMMT) warns.

The UK government must respond boldly to initiatives such as the $370bn Inflation Reduction Act in the US and the EU Green Deal Industrial Plan, according to the SMMT

The trade association said competing global players are getting bold political and economic backing for their own automotive sectors, putting them at the forefront of the ‘race to zero’.

And it’s calling for the UK government to get behind its own £67bn automotive sector and “pitch positively to the world” to win green growth, jobs and prosperity.

In a new report, the SMMT highlights the UK’s intrinsic strengths in electric vehicles – including advanced automotive manufacturing, low carbon energy and R&D.

But it stresses the need for an urgent response to initiatives such as the $370bn Inflation Reduction Act in the US and the EU Green Deal Industrial Plan.

Recent weeks have seen the Government increasingly under criticism for its comparative lack of industrial strategy and competitive subsidy packages – in particular following the collapse of Britishvolt, which has highlighted the precarious position of EV battery manufacturing in the UK. Australia’s Recharge has now agreed to buy the majority of the business and assets while the Government’s hands-off approach has attracted ire.

Now, China’s BYD has reportedly said it will not consider building its first European car factory in the UK because of the impact of Brexit. According to The Guardian, BYD said the UK had not even made a top 10 list of possible locations to build its first European car plant.

The SMMT has responded to global competition for EV production with its new blueprint, which sets out a Green Automotive Transformation strategy that would position Britain as one of the world’s most competitive locations for advanced automotive manufacturing and support the 2030 ICE ban.

Investment, regulation and trade as seen as the three key pillars to anchor future vehicle production in Britain. Priorities include de-risking private capital with more competitive incentives and action on energy costs, with support for the next British ‘unicorns’ in batteries and renewables, which will stimulate greater investment in EV enterprises.

Reform of regulation will accelerate delivery of new production facilities and renewable energy generation. Maximising trade opportunities, meanwhile, would help secure access to essential raw materials. Such moves will secure the essential gigafactories which can underpin EV production.

The SMMT also highlighted the significant progress made by the domestic automotive sector and supply chain. To date, more than £11bn has been invested by manufacturers in EV production locally, leading to fully electric or hybrid vehicles comprising almost a third of all UK-built cars last year, with an export value of £10bn. By 2025, the sector is anticipated to produce more than 20 models of electric cars, vans, buses and trucks, contributing to the economy and jobs in all regions of the country.

It also spotlights how the UK contributes to the EV supply chain; 17 of the world’s biggest automotive suppliers have a UK base, and a new SMMT EV Supply Chain Directory reveals that Britain produces almost every component required to manufacture tomorrow’s zero-emission vehicles in some capacity.

But such capabilities “can and must be scaled up quickly”.

Mike Hawes, SMMT chief executive, said: “Britain boasts a firm foundation of EV production, backed by low-carbon energy, outstanding R&D and a highly skilled and productive workforce. We must not squander these advantages. With other parts of the world turbocharging their support for the zero-emission vehicle transition, we need to step up to compete in this global race. Every part of the country has a stake in the switch and with fast, decisive action we can deliver for Britain the growth, jobs and green prosperity this country deserves.”

Download the report here.