The intended closure of Ford’s Bridgend engine plant in 2020, with the loss of 1,700 jobs, has sent shock waves through Wales. Plaid Cymru leader, Adam Price, has described it as “one of the worst acts of ‘industrial vandalism’ seen in the UK for decades.” Ford representatives have said that the company needs to “make its engine manufacturing base suitable for the vehicles it produces in the future.”
With electric vehicles (EVs) commanding a growing share of the global car market, many including Professor David Bailey have stated that the “production of electric motors was much more important to securing Ford Bridgend’s future” in order to stay competitive in the global automotive industry.
Engine manufacturing is the most valuable part of making a conventional car. An enormous amount of knowledge, skill and research and development is required to make highly sophisticated internal combustion engines.
Ford is the largest producer of these engines in the UK – and about half of its output comes from the Bridgend factory. Experts have observed that the electrification of cars “is arguably more of a threat to the UK automotive industry than Brexit.” But there is still a chance for the UK to stage a revival.
There is already some EV manufacturing taking place in the UK, by Nissan in Sunderland and Aston Martin in South Wales. There are also new facilities being established to manufacture EV batteries and the materials required to make them, from Port Talbot to Coventry.
But there have been setbacks: critically, the UK is no longer a headquarters for any major auto producer, let alone one leading in the EV space. It’s difficult to build up sustainable operations when decisions are made overseas.
This is evident in Jaguar Land Rover’s decision to cut UK production of its Discovery model, while subcontracting i-Pace electric production to Magna Steyr in Austria. Without being able to rely on any favour from an indigenous car maker, the UK must take its own steps to become the best place to make EVs.
With the UK government keen to achieve net zero carbon emissions by 2050, there’s an opportunity for the nation’s automotive industry to develop and deploy EV technology and become a global leader – but this needs to start now, or the chance will be lost.
Supply and demand
There are two key factors for success – supply and demand. Of course, there must be enough demand for products manufactured in the UK, and the nation must be able to export to those markets. But the UK must also have good access to the supply chains that provide the parts and materials needed to manufacture EVs.
Many commentators already lament the effect that Brexit is having on the UK automotive sector. Less obvious, is how this may affect the supply of critical materials needed to develop and manufacture EVs. Global concerns about the supply of these materials is rising – and organisations, including the International Energy Agency, are investigating.
The UK does not have local supplies of many of these materials – but as a member of the European Union, it is a part of the bloc’s broader strategy. After Brexit, the UK will have to consider its strategy in isolation. Some have warned that the UK could be “held to ransom” over supplies of these critical materials.
China has a near monopoly on the supply of rare earth materials such as Neodymium, which is used to make the powerful magnets used in the most efficient EV motors. As tensions between China and the US escalate, there’s a chance China could use its power over rare earth supply for leverage, which could cause significant shocks to Western car manufacturers.
Some manufacturers have been spooked by this prospect and are exploring rare earth-free engines – though currently these designs are less efficient. But a less efficient motor will require a bigger battery to provide the same range (all other things being equal) and bigger batteries will place pressure on other critical materials supply chains – such as Cobalt and Lithium.
Recycling rare earths
To succeed then, the UK needs a unique selling point – some advantage that other countries do not have. It needs access to these key resources. Despite their name, rare earths are not actually scarce. But there is a need to develop processing routes and new cleaner techniques for producing these materials.
The UK could become a world leader in the supply of these materials – not through mining and extraction, but through recycling and processing. The UK already has research and development organisations leading projects investigating the reuse and recycling of battery materials. A similar capacity to recycle rare earth magnets would safeguard the UK’s supply chain and help stabilise the price of materials used to manufacture EVs.
A large collaborative EU project, with a significant UK presence, SUSMAGPRO, will tackle some of these challenges. But for UK automotive it’s essential that more of this capability is embedded in the fabric of UK industry to support the supply chains that will power the EV revolution.
Saving South Wales
There are already encouraging signs that the skills and capabilities exist in South Wales to support the transition towards producing electric drivetrains. Indeed, the UK’s only producer of electrical steels – Cogent Power Ltd – is based in Newport.
There is also a longstanding base for soft magnetic materials research at Cardiff University School of Engineering, and significant new investment is being made to develop this area further. This is complemented by research and facilities at Swansea University and the University of South Wales, with specialism in steel processing.
In spite of significant closures, hope is not lost for the UK’s automotive industry. But the time to act is now.