Sustainability, skills, supply chains and dissatisfied women

Posted on 14 Jun 2013 by The Manufacturer

The fifth annual SMMT International Automotive Summit at Canary wharf raised diverse topics around the challenges and opportunities for UK and global car making.

International leaders from the automotive industry gathered in London’s Canary Wharf yesterday to discuss the most pressing issues facing their global industry.

Around 250 senior industry representatives attended the event which was opened by a keynote speech from Andy Palmer Executive Vice President at Nissan Motor Company.

Mr Palmer’s opening remarks were powerful; littered with punchy statistics which showed both the excellence of UK car manufacturing and the myriad potential defects in the global industry’s future if innovation is not pushed hard today in product development, societal change and skills development.

Palmer was adamant that “the UK has entered an era of mass production of electric vehicles,” and that electric propulsion will form an increasing proportion of the automotive power mix in the future.

While The Economist recently suggested that electric vehicles are becoming something of a global disappointment as infrastructure and technology flaws bar them from becoming common place features in global transport networks, Palmer pointed out that Nissan has achieved 65 million sales of it electric car, the Leaf. “I don’t call that disappointing and I don’t really care what anyone else thinks,” he shrugged.

Illustrating the danger in ignoring the importance of electric vehicles, Palmer pointed out that public officials in Beijing have recently been asked to stop driving internal combustion engine-powered vehicles due to smog levels. He said that views on global warming aside, the fact that the world now has 800m cars in operations, producing millions of tonnes of CO2, “is not good for anyone.”

He also asserted that there was a stark sustainability flaw in the fact that 87% of the global automotive industry’s power demand – through life – comes from three fossil fuels which are finite.

While electric vehicles were the focus of Palmer’s technology thrust, the steady rise of autonomous driving systems was also referenced.

Women and skills

Palmer outlined the need for more intuitive design in vehicles of all kinds and linked this to the skills car makers need to think carefully about nurturing in order to compete in the future.

“Fifty per cent of women [globally] are dissatisfied with their cars,” claimed Palmer, going on to define the dangers of failing to address the requirements of this powerful user base more accurately.

He linked the flaw to the fact that automotive companies need to recruit more women. “Nissan has only ten per cent of women in its ranks,” he admitted.

Building on the theme of intuitive design and market understanding Palmer also criticised his industry for underestimating the importance of marketing skills. “We need more mathematicians and less party planners,2 in marketing said Palmer who admitted that when he first joined the company, marketing professionals had been known as ‘flower arrangers’.

With marketing now a significant part of Palmer’s own job, he said it was incredibly important to know how numbers should add up behind a successful campaign.

Collection and analysis of marketing data linked to a recognition of the power of Big Data in the car industry where every vehicle is becoming more “like a giant mobile phone,” every day he said.

Palmer’s speech gave a strong kick-start to the SMMT’s annual event, which also hosted an expert panel, directly addressing skills issues. Linda Jackson, managing director at Citroen UK & Ireland participated on the panel, expressing dissatisfaction with the fact that “seventy per cent of women in automotive hold ‘light touch’ admin roles.” Ms Jackson is the UK car industry’s only female MD.

Broader skills issues highlighted the importance of apprenticeships, both craft level and higher, across business functions. Bentley Motors Leonie Williams, head of manufacturing and labour relations, highlighted that the company supports supply chain and procurement apprenticeship frameworks in addition to production and engineering qualifications.

Bentley attracted 1000 applicants for 20 apprenticeship places this year.

Supply chain

The roaring success of OEM’s in attracting talent and servicing global demand contrasts however with continuing difficulties in the SME supply base in the UK.

A special stream at the conference addressed this dichotomy and profiled the work of Jaguar Land Rover to develop support mechanisms to help suppliers develop the capacity and capability needed to service OEM demand locally.

This work includes the beginnings of a banking arrangement to support investment in expensive tooling which Chris Gane, divisional MD at the diversified engineering group Caparo, said “strips cash from the business.”

In addition to the supply chain stream, a speech from business secretary Michael Fallon, acknowledged the hardships still being faced by automotive SMEs in the shadow of booming OEMs and tier 1 suppliers, but offered hope.

Mr Fallon congratulated the Automotive Council on its work in addressing supply chain problems over the last year and announced that Joe Greenwell, formerly of Ford of Britain, has accepted responsibility for a new initiative, the Automotive Investment Organisation.

This scheme is designed to support investment and skills development – at both a technical and managerial or strategic level – in the UK automotive supply chain. It has been created in response to an Automotive Council report published last year which showed the UK is missing out on the chance to supply around £3bn worth of products and component to UK-based OEMs which are currently sourced from abroad.

Ian Henry, director of AutoAnalysis, said he thinks this estimate is “conservative”.

Full transcripts from the keynote speeches made at the fifth International Automotive Summit and further information about the streamed sessions can be found here.