The United Kingdom’s decision to not set out specific support for automakers in its 30 billion-pound ($37.6Bn) package to help the economy through the coronavirus has left the sector feeling vulnerable.
British Chancellor Rishi Sunak left out targeted aid for manufacturing in a plan announced Wednesday.
The SMMT automotive trade group said the UK “stands alone” among Europe’s largest carmaking countries in failing to provide dedicated measures.
“It’s bitterly disappointing the chancellor has stopped short of supporting the restart of one of the UK’s most important employers and a driver of growth,” Mike Hawes, SMMT CEO, said in a statement.
Bentley, Aston Martin and supplier Johnson Matthey are among UK automotive manufacturing companies planning to drop more than 50,000 posts in total, based on a Bloomberg tally.
More UK jobs are at risk, and automakers are seeking sector-specific measures to support cash flow such as business rate holidays, tax cuts, along with policies that would boost consumer confidence and big-ticket purchases, according to the SMMT.
No furlough extension
Sunak unveiled plans to get Britain through what could be the worst recession in 300 years.
The measures include a cut to the value-added tax for tourism and hospitality businesses, and a 2.1 billion-pound plan to fund jobs for young people hit by unemployment. But the chancellor resisted calls to extend beyond October the UK furlough subsidy that the auto industry has relied on.
Sunak ruled out extending salary support measures and said it would risk giving people “false hope” that their jobs will continue to exist.
The manufacturing sector has called for a targeted scheme to reflect the reality that demand has evaporated in the near-term while preserving skilled workers for its eventual return.