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Cars (Imports)

Volume 84: debated on Wednesday 23 October 1985

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asked the Secretary of State for Trade and Industry what representations he has received from BL about the report by Dan Jones on import penetration of cars.

None, but I recognise the concern about the sourcing policies of the multinational car companies, and there have been discussions with those companies. Ford has now said that it plans to manufacture 70 per cent. of its United Kingdom car requirements in its United Kingdom plants in the second half of 1985, and to maintain or increase the 80 per cent. United Kingdom content in these cars. Vauxhall aims to increase the number of cars and car-derived vans that it manufactures in the United Kingdom from 45 per cent. of its requirements in 1984 to 56 per cent. this year. Vauxhall will also raise the United Kingdom content of its vehicles from an average of about 46 per cent. in 1984 to about 49 per cent. by the end of this year. I regret that, after lengthy discussions, Vauxhall is not yet ready to go further in proving that it really is a British car producer.

Has not the report, with its revelation that exactly two-thirds of car sales in Britain come from imports, prompted the Government to push General Motors, Ford and Peugeot into making public their plans for investment and future manufacture in this country? Does the report not show that the catastrophic fall in employment in the car industry from 500,000 to 250,000 over the past 10 years is because multinational companies such as General Motors and Ford have no loyalty to Britain or to their workers, and that their loyalty is purely to the global strategy of profit and money?

I do not believe that the hon. Gentleman's analysis will assist the British motor industry. The causes that have led to the fall in British car manufacture are much more complicated than the hon. Gentleman suggests. He has to look at such things as labour practices, productivity and wage claims. The progress made by some British car manufacturers, in particular British Leyland in the past few years, resulting in their getting to grips with the difficulties, has been remarkable and should be commended.

Instead of listening to hard luck stories about British Leyland and import penetration, will my right hon. and learned Friend listen to the success stories of General Motors, and in particular Vauxhall Motors? Does he appreciate that output by Vauxhall Motors has doubled in recent years, that the United Kingdom content of Vauxhall cars is going up quite dramatically and that, unlike British Leyland, Vauxhall, certainly at Luton, has received no Government money, whereas BL has received £1·8 billion over the past two years? Will my right hon. and learned Friend talk about the success stories rather than listening to the carping of British Leyland?

I am happy to compliment my hon. Friend's constituents on the sterling work that they have done and I hope that that will lead to General Motors to ensure that more Vauxhall cars are made in Britain.

In the general endeavour to get some balance into our motor industry, can we expect that the new Secretary of State will initiate strenuous attempts to achieve balance in the trade between Spain, and this country, to enable Austin-Rover to trade on equal terms in that country and not have to climb over a tariff barrier four times as high as that faced by the Spanish manufacturers?

The hon. Gentleman is making a perfectly fair point about Spain, and this is one of the matters where Spanish entry into the EC will assist, because it will lead to a reduction in the tariff and an increase in the reduced duty quota.

Will my right hon. and learned Friend bear in mind that the manufacturers in my constituency, and in particular Land Rover, would benefit greatly in terms of competition if they could enjoy lower interest rates and more favourable exchange rates, and if there were a review of the special VAT on cars?

These were among the points made by the Society of Motor Manufacturers and Traders at its conference this morning and I am conscious of the interests and desires of the society in that respect.

Has the Secretary of State seen this absurd advertisement, which says "GM loves UK', ending with the words

"We seem to be a perfect match"?
Does the right hon. and learned Gentleman agree that for us this is a case of unrequited love, as GM told the House of Lords Select Committee that imports to the United Kingdom of foreign-made kits, for cars to be merely assembled here by Meccano technology, have increased more than threefold, from 51,000 in 1981 to 163.000 last year and in the meantime GM's net adverse trade balance has reached the appalling figure of £656 million? Far from being a perfect match, is not the reality that GM has leeched on to the British market under the disguise of British labels to sell foreign cars while exporting British jobs to the EC?

I have given the figures and my comments. I do not think that it helps to put the matter in the terms that the right hon. Gentleman does. Having said what I have said about our disappointment that it has not been possible for General Motors to go further, one has a duty to point out that if the British components' share in the product is not so high as one would like one must ask whether British component manufacturers cannot produce products which General Motors must recognise ought to be included in its cars, on price considerations alone.