HC Deb 24 February 1982 vol 18 cc398-9W
Mr. Ray Powell

asked the Secretary of State for Industry (1) what were the main factors responsible for the increase in the number of cars imported into the United Kingdom from EEC countries from 134,000 in 1970 to 555,000 in 1980, and for the decrease over the same period in the number of cars exported from the United Kingdom to EEC countries by some 20 per cent.;

(2) what were the main factors responsible for the increase in the number of cars imported into the United Kingdom from non-EEC countries from 24,500 in 1970 to 316,000 in 1980 and for the drop in the number of cars exported from the United Kingdom to non-EEC countries from 546,500 in 1970 to 236,700 in 1980.

Mr. Wakeham

Throughout the period the United Kingdom car industry was generally uncompetitive against its European rivals and even more so against the growing strength of the Japanese industry. Ability to compete effectively on price was affected by chronically unfavourable levels and rates of growth of productivity. While until recently the effect of this on costs tended to be offset, though with a lag, by a declining sterling exchange rate, non-price factors such as quality and delivery performance are also considered to have had a deleterious effect on the United Kingdom motor industry's competitiveness over this period.

The result has been a very rapid increase in import penetration in the United Kingdom car market and a decline in the United Kingdom share of foreign markets. Accession to the European Community in 1973, combined with the geographical proximity of European countries, boosted the United Kingdom's trade with other members of the Community. It is natural, therefore, that United Kingdom car exports to EEC countries should have declined less than its car exports to other countries and that its imports from other EEC countries should have increased to a much greater extent than those from non-EEC countries other than Japan.

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