Full story: BMW U-turns on plans to move electric Mini production from UK to China
Kalyeena Makortoff
BMW will unveil a significant investment in its Mini plant in Oxford today, a move that will secure 4,000 jobs and strengthen the UK’s electric vehicle supply chain.
The investment by the German carmaker is the result of “extensive” engagement with the UK government, according to the business and trade department, and marks a reversal of plans to move electric Mini production abroad to China.
The plans to move production overseas – revealed last year – were seen as a blow to the UK’s ambitions to become a leader in global electric car manufacturing, and followed Honda’s decision to quit the UK in 2019.
The U-turn was hailed by government ministers including the chancellor, Jeremy Hunt, who said BMW’s investment was “a huge vote of confidence in this country as a global leader in electric vehicles”.
Hunt said:
“This industry is motoring, creating thousands of jobs and powering our green transition.”
The government said BMW’s move represented a “multimillion-pound investment” but did not disclose a figure.
The carmaker is expected to provide further details on the investment, including the total sum, later on Monday, with the taxpayer also providing government funding (previously reported at £75m).
More here:
Key events
Newsflash: back in the UK retail world, negotiations over a rescue deal that could have preserved hundreds of Wilko stores appears to have collapsed.
The rescue package proposed by businessman Doug Putman, who engineered a turnaround of HMV in the UK, has collaped, reports Sky News’s Mark Kleinman.
Putman’s plan could have saved as many as 300 of Wilko’s stores.
Here’s the details:
Exclusive: The proposed rescue deal for Wilko involving Doug Putman, the owner of HMV, has collapsed after weeks of talks about a transaction that could have salvaged hundreds of stores. Wilko’s administrators are now expected to pursue a deal to sell roughly 100 stores to…
— Mark Kleinman (@MarkKleinmanSky) September 11, 2023
2/2…to Poundland, while The Range, another value retailer, is expected to sign an agreement to acquire the Wilko brand in the coming days. The Putman rescue is thought to have collapsed over the weekend, although it’s unclear whether an announcement is imminent. Full story soon.
— Mark Kleinman (@MarkKleinmanSky) September 11, 2023
Kemi Badenoch adds that she has been speaking to UK car makers about their concerns over the new Brexit ‘rules of origin’ requirements.
Those new tighter rules mean electric car batteries must be sourced from within the two trade partners or face 10% tariffs.
Several carmakers have called for these rules to be negotiated, warning they will push up the cost of electric vehicles in showrooms.
Badenoch adds that she is also speaking to the EU trade commmissioner about this issue, explaining:
You will have seen the reports that he agrees with me. It’s something we’re working on.
Badenoch argues that the rules made sense when the Brexit trade deal was negotiated, but that was before Covid-19 and the war in Ukraine created supply chain disruption.
Business minister Kemi Badenoch says that “quite a lot” of the investment being announced for BMW’s Cowley car factory today is new money.
But, she won’t reveal how much exactly, telling Sky News:
I can’t talk specifically about the investment amount because that is something that I promised BMW, because they want to be able to talk about their investment later on, at their event later today in Cowley, in Oxfordshire.
Badenoch adds that the government’s automotive plan is getting results, pointing out that Stellantis began producing electric vehicles at its Ellesmere Port site last week.
Sky News point out that millions of pounds in taxpayer support from the government have helped persuade BMW to build its next-generation electric Mini in Oxford, adding:
Whitehall sources declined to give details on the level of taxpayer support being offered, but did not dispute Sky’s £75m figure.
The government said BMW’s impending announcement means total investment into the country’s automotive sector has now topped £6bn over recent years.
BMW’s new multi-million pound investment at its Oxford site will avert “a disaster” for the UK car industry, says Bloomberg.
But even so, UK automobile investment is lagging behind some rivals, they add:
The company’s multimillion-pound outlay toward electric Mini production in Oxford averts what would have been a disaster for the UK, where car production slumped last year to the lowest since 1956.
The factory employing more than 3,400 people was dealt a setback 11 months ago when BMW announced it was shifting electric Mini output to China.
While the revival of electric Mini assembly in Oxford adds to recent momentum for the UK car sector, the country isn’t keeping pace with nations taking more aggressive approaches to industrial policy. The more than £6bn ($7.5bn) of investment announced in Britain’s auto industry since 2020 pales in comparison to the $72bn that companies have earmarked for North America since the US passed the Inflation Reduction Act last year.
Full story: BMW U-turns on plans to move electric Mini production from UK to China
Kalyeena Makortoff
BMW will unveil a significant investment in its Mini plant in Oxford today, a move that will secure 4,000 jobs and strengthen the UK’s electric vehicle supply chain.
The investment by the German carmaker is the result of “extensive” engagement with the UK government, according to the business and trade department, and marks a reversal of plans to move electric Mini production abroad to China.
The plans to move production overseas – revealed last year – were seen as a blow to the UK’s ambitions to become a leader in global electric car manufacturing, and followed Honda’s decision to quit the UK in 2019.
The U-turn was hailed by government ministers including the chancellor, Jeremy Hunt, who said BMW’s investment was “a huge vote of confidence in this country as a global leader in electric vehicles”.
Hunt said:
“This industry is motoring, creating thousands of jobs and powering our green transition.”
The government said BMW’s move represented a “multimillion-pound investment” but did not disclose a figure.
The carmaker is expected to provide further details on the investment, including the total sum, later on Monday, with the taxpayer also providing government funding (previously reported at £75m).
More here:
Dame Sharon White calls for Royal Commission review into ailing high streets
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The chair of the John Lewis Partnership is calling for the UK government to launch a new Royal Commission help rescue and restore Britain’s high streets.
Dame Sharon White warns that the UK high street is in poor health, and that planning, taxation, crime, environmental policy, housing and transport all need to be considered together to find solutions.
Writing in the Daily Telegraph today, she says:
Too many towns and cities are shells of their former selves. Boarded-up shops left vacant, dwindling numbers of banks and post offices. And in their place, seemingly endless rows of vaping and charity shops. For too many local residents, the heart has been ripped out of their community.
Britain has lost 6,000 shops in the past five years, according to the British Retail Consortium. There are John Lewis and Waitrose stores amongst these statistics, but the Partnership is still standing strong, with more than 360 physical shops nationwide.
The collapse of Wilko this summer, which has already cost over 1,000 jobs, has highlighted the problems in retail.
The sector has endured a tough 15 years. First the financial crisis triggered a recession, followed by a long programme of austerity that squeezed household incomes.
The move to internet shopping forced more retailers to the wall, as the slump in the pound after the Brexit vote drove up import costs.
Between 2013 and 2018, one in 12 shops closed. And that process continued as the Covid-19 pandemic led to months of lockdowns, driving consumers to web shopping instead.
Dame Sharon argues that a Royal Commission could consider the best mix of retail, hospitality, offices and housing needed locally, to return high strees to becoming more welcoming places where people want to live, work and spend time.
She points out that the last Royal Commission into the health of UK towns was 180 years ago, so it’s time to put high streets under the spotlight again.
Dame Sharon writes:
Is it too naive to believe that, with an election approaching, the political parties could join forces for the good of the country on an agenda that aligns so closely with the Government’s levelling-up ambitions and the Opposition’s industrial strategy? Only a Royal Commission can set out a fresh vision for a prosperous high street for decades to come.
Just as the 1848 Public Health Act offered the chance to make a real difference for citizens of Victorian Britain, our generation has the opportunity to leave a lasting legacy for our communities and high streets for decades to come. Britain’s high streets have hope, but they need help.
More here: Bad policy is murdering our high streets
Also coming up today
BMW are announcing plans to build its next-generation zero-emission battery electric Minis in Oxford today, after securing a funding package from the UK government.
The carmaker is making a multimillion pound investment in its electric Mini production, the business ministry has just revealed,
The investment should secure the long-term future of Mini production in Britain, and secure 4,000 jobs.
We’re expecting an announcement from the company this morning.
Rishi Sunak said the government was securing jobs and growing the economy “by backing our car manufacturing industry”, adding:
“BMW’s investment is another shining example of how the UK is the best place to build cars of the future.”
The agenda
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9am BST: Bank of England’s chief economist Huw Pill is a panellist at the Kent Invicta Chamber of Commerce
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2pm BST: Russia’s balance of trade for July