HC Deb 15 January 1986 vol 89 cc1061-2
5. Mr. Wood

asked the Secretary of State for Trade and Industry what steps he is currently taking to seek to persuade car manufacturers based in the United Kingdom to increase the United Kingdom content of their cars sold in the United Kingdom.

Mr. Peter Morrison

My right hon. and learned Friend, I and officials meet senior management of the United Kingdom car manufacturers regularly to discuss this and similar matters, with encouraging results. For example, after a recent meeting with my right hon. and learned Friend, Vauxhall's chairman and managing director announced the company's plan to increase the United Kingdom content of the vehicles that it builds here from about 50 per cent. in the past year to about 60 per cent. by the end of this year.

Mr. Wood

I thank my hon. Friend for that reply. Concern is caused when individuals are encouraged to buy British and some manufacturers, although based in this country, use a large imported content in their vehicles. Does my hon. Friend agree that good component manufacturers operate in Britain and that they should be encouraged by further purchases from firms such as Vauxhall?

Mr. Morrison

I agree with my hon. Friend. As I said in my original answer, my right hon. Friend and I, and others in the Department, do everything that we possibly can to encourage purchases from home-based component manufacturers.

Dr. Marek

Is the Minister aware that one of the steps that he can take is to ensure that we have a continuing supply of competitively priced and efficiently produced engineering steel in Britain? Will the Minister do everything in his power, if the United Engineering Steels company wishes, to ensure that a concast is installed at Brymbo steelworks?

Mr. Morrison

The hon. Gentleman makes a particular and specific point. I agree that the component parts are important. I am happy to take his point on board and to look at the matter carefully. I can say no more than that at this stage.

Mr. Roger King

Does my hon. Friend agree that there is a contrast between our open attitude in ensuring as free a market as possible for the manufacture of cars in Britain and the attitude of other countries, notably Spain, which is conducting a blockade of our components?

Mr. Morrison

Yes, but as my hon. Friend will be aware, negotiations are proceeding. We hope that they will be brought to a successful conclusion.

Mr. Williams

As nearly all the increased import penetration in the car market since the late 1920s has arisen from the tied imports of Ford and Vauxhall—of course, we welcome the recent modest announcement—does the Minister agree that Vauxhall., with its massive trade deficit on vehicles, must make a far more substantial investment in major components, such as engines and transmissions, made in Britain, and possibly restore a design capability? Have not the Government made such investment more difficult with their record of five years of abnormally high interest rates? Interest rates are almost double what firms would have to pay if they went to Germany.

Mr. Morrison

I would not describe the recent announcement as modest. It represents a significant increase. I agree with the hon. Gentleman that the more our domestic component manufacturers sell, the better. His wider question is a matter for my right hon. Friend the Chancellor of the Exchequer.

Mr. Hanley

While recognising my right hon. and hon. Friends' considerable efforts in increasing the United Kingdom content of cars made in the United Kingdom, may I also ask that they recognise the tremendous contribution made by United Kingdom car component manufacturers to the content of cars made abroad? Will they encourage foreign buyers to buy even more components from the United Kingdom?

Mr. Morrison

I entirely agree with my hon. Friend. The more that United Kingdom car manufacturers buy domestically, the more it will encourage foreign manufacturers to buy products made by British component manufacturers.