After bad news in chocolate and steel manufacturing some good news in cars and nuclear engineering. Most of it with the help of government loans.
Nissan announced that their new electrically powered car, the Nissan Leaf, will be produced in Sunderland from 2013. Up to 50,000 cars a year will be made. Nissan stated that the UK commitment to providing the infrastructure and education to operate these cars helped the decision. The North East has agreed to fit 13,000 charging points and London 25,000. Also a novel leasing arrangement for batteries will ease the cost of ownership and another plus the batteries will be made in Sunderland as well. Photographs of the car look quite smart with nothing to make it look different. Ironically the ‘green’ car will be produced next to the Juke urban off-roader which doesn’t sound quite as green.
Ford announced about £1.5bn investment in new efficient engine R&D and manufacturing in the UK. A significant portion of the money will be loans from the UK Automotive Assistance Programme and the EU. Ford will test 15 electric vehicles as well as work on low carbon engines. Ford produce 25% of their world supply of engines in the UK.
Sheffield Forgemasters received government loan support to make a 15,000 tonne forging press, making the company one of two companies in the world capable of making specific nuclear components. The government said the UK can produce 50% of the parts for a nuclear power station and the investment will take it to 70%. The government is also to support up to 1000 apprentice places a year in the nuclear industry.
It is a curious business the offering of loans to keep manufacturing in a country. Subsidising has long been illegal in the EU. However such large scale investment is often only possible with government assistance. Vice versa governments often say that infrastructure projects, for such as energy, cannot be afforded without industrial investment. Does one balance the other out or is it just convenient to make the best of both worlds. No doubt a company has to get the best deal it can so an existing plant must count for something and make the loan required less than it would be from a place without a plant or who didn’t have other incentives to offer such as car power point infrastructure. We can only welcome this as good news.