HC Deb 12 July 1982 vol 27 cc640-1
18. Sir David Price

asked the Secretary of State for Industry how many new motor cars were sold in the United Kingdom in the first half of 1982; what percentage was of United Kingdom manufacture; and how these figures compare with similar figures for 1981 and 1980, respectively.

Mr. Butcher

The proportion of cars sold in the United Kingdom in the first half of 1982 which were of United Kingdom manufacture was 42.3 per cent. compared with 46.1 per cent. and 42.4 per cent. in the corresponding periods of 1981 and 1980 respectively. I shall publish the full information in the Official Report.

Sir David Price

Can my hon. Friend tell the House how his Department defines a car of United Kingdom manufacture? What percentage of the components must be of British manufacture? Is my hon. Friend aware that a change in the statistical base can entirely alter the results?

Mr. Butcher

My hon. Friend asks a timely question in the light of the debate on the Nissan project. We have put a percentage on the joint venture deal with Honda. I ask my hon. Friend to use that as a rough rule of thumb, although we expect a higher proportion in our domestic manufactures. My hon. Friend's question is timely also because British consumers are about to purchase Y registration cars. I hope that they will consider seriously the implications of what they are doing, particularly as we have a strong and viable domestic manufacturing base today.

Mr. Geoffrey Robinson

Does the Minister agree that the declining share of British made motor cars reflects a declining share of British Leyland cars on the home market, which this year is 2 per cent. down on last year? With reference to the Nissan project, about which the Minister of State was frank with the House, and which, in its original form, was as dead as a dodo, before we get a watered-down version of that, will the Government enter seriously into discussions with British Leyland about the opening of a plant in the Midlands for the expansion of British-based manufacture?

Mr. Butcher

The hon. Gentleman and I share neighbouring constituencies. He will understand that I have some sympathy with his final observation. However, it would be most unwise to make a controversial statement immediately on the Nissan project. As we know, the details of the negotiations with the Department of Industry were agreed to a fairly satisfactory extent. The strategy is a matter for the Nissan company. We shall meet representatives of the company in the Department of Industry towards the end of the month.

Mr. Colvin

Has my hon. Friend asked my right hon. and learned Friend the Chancellor of the Exchequer to consider eliminating the 10 per cent. special car tax to stimulate sales?

Mr. Butcher

A number of ideas are being mooted at the moment which are designed to boost demand for United Kingdom manufactured cars. That is the key question. Any stimulus that comes, which is entirely a matter for the Chancellor of the Exchequer, must take account of the effect that it might have on imports as well as on domestic manufacturers.

Mr. Campbell-Savours

Will not the British Leyland car market contract if British Leyland is allowed to sell 400 of its 1,600 showrooms? Will the Minister intervene to ensure that the 400 showrooms, if sold, are not taken over by Continental manufacturers who can thereby further reduce British Leyland's car markets?

Mr. Butcher

I suspect that there is a small dose of speculation in the hon. Gentleman's question. Even if there were not, it would still be a matter for Sir Michael Edwardes and his board to decide, although I share the hon. Gentleman's concern that foreign manufacturers may take over such outlets if that hypothetical situation were to arise.

Mr. Donald Stewart

What are the Government doing about British manufacturers who are taking a rake-off of upwards of £1,000 on the same car manufactured on the Continent?

Mr. Butcher

Car price differentials are a matter of great controversy. I suspect that they reflect more the policies of individual car manufacturers than they do the differential fiscal policies of nation States in Europe. The matter is the subject of considerable inquiry by my noble Friend the Secretary of State for Trade, and I shall pass on the right hon. Gentleman's remarks to him.

Mr. Hal Miller

Does my hon. Friend agree that the British Leyland dealers are being pressed on their margins, particularly because of the difficulty of getting rid of used vehicles? Will he therefore consider the need for representations to relax hire purchase restrictions to bring them into line with those pertaining to other goods? Does my hon. Friend agree that reducing a typical payment from £90 to £65 a month would have the effect of widening the market?

Mr. Butcher

I have seen the submission from George Turnbull and the SMMT on this matter. My hon. Friend is absolutely right. To increase demand in that way would release the log jam, particularly on used car sales and, in turn, new car sales. However, this is a matter for my right hon. and learned Friend the Chancellor of the Exchequer. I am sure that he is in no doubt about the strength of the arguments deployed on the lines put forward by my hon. Friend.

Following is the information:

United Kingdom motor vehicle sales
Sales of new cars in the United Kingdom Percentage of which of UK manufacture
1980 first half 869,168 42.4
1981 first half 797,937 46.1
1982 first half 781,881 42.3


Society of Motor Manufacturers and Traders.