One whinge is enough to send Starmer running back to EU

WE should not be surprised that Labour leader Keir Starmer’s immediate response to complaints by motor manufacturers – over a shortage of battery factories for electric cars in the UK – is to play the European Union card.

As a staunch Remain supporter, who once favoured a second referendum because he didn’t like the outcome of the first, the Labour leader is willing to stretch every sinew to break with Britain’s Brexit decision.

All it has taken is a whinge from the Vauxhall-to-Fiat car giant Stellantis about Britain’s failure to build battery giga-factories for electric cars, and Starmer has taken to the airwaves pledging to go back to Brussels and negotiate a ‘better deal than the one we have’ for the motor industry.

Stellantis told Parliament yesterday it faced tariffs of up to 10 per cent on vehicle exports to the EU as a result of post-Brexit trade rules set for 2027 – under these rules, the tariffs will apply because Stellantis cannot buy batteries in the UK and has to import them.

It says that thousands of jobs at Vauxhall and other car makers will be lost unless the UK goes cap in hands to Brussels and seeks improved terms for the industry. It also claims that making electric vans in the UK would become uneconomic unless the post-Brexit deal is redrawn.

In those febrile days after the Brexit referendum, it was the motor industry that made the loudest noises about the result, threatening to up sticks and move to the EU.

Fearful of the loss of tens of thousands of jobs, Theresa May’s government was persuaded to offer help to some of the richest companies in the world to ensure they stayed in Britain. For a company such as Stellantis, with brands and facilities in several European countries, using jobs as a bargaining chip has proved an effective tool with which to bully governments.

The truth is that, in spite of the profound

shock of the pandemic which saw new car sales grind to halt, the UK’s motor manufacturing – from upmarket Jaguar Land Rover to mid-market Nissan in the North East – has remained surprisingly vibrant.

Japanese-owned Nissan, instead of seeking concessions from Eurocrats, decided early on it would control its own fate by investing heavily in batteries for electric vehicles.

Last year, Japanese-controlled battery manufacturer AESC started construction of a second gigafactory near Sunderland’s Nissan plant, bringing its planned investment in the UK up to £1billion.

This means that output by Nissan will not be affected by the EU rules which Starmer, if in power, would rush to renegotiate.

Vauxhall is just a small part of Stellantis which is the world’s third largest carmaker and owner of 14 brands including Peugeot, Citroen and Fiat. Its market power and assortment of brands mean it can easily afford to use Vauxhall to extract concessions from governments.

Nevertheless, Stellantis has exposed a huge failure in Britain’s post-Brexit industrial planning. The UK is a pioneer in much of the technology for electric vehicles. GKN Automotive, now reborn on the London Stock Exchange as Dowlais with a global turnover of £5.2billion, is the world’s leader in developing powerdrives for EVs. The British engineering company Johnson Matthey is a leading processor of nickel and other components for advanced lithium batteries.

Yet compared to other European countries, we are still at the starting gate when it comes to battery production.

As Europe’s largest producer of cars, Germany has gone all out to ramp up battery manufacturing. With the support of Tesla founder Elon Musk, work began on a battery gigafactory at Berlin-Brandenburg in 2019. Not to be outdone, Volkswagen is constructing a similarly large-scale facility at Salzgitter, in Saxony.

Several more plants are planned or under construction. Spain, meanwhile, is engaged in an arm-wrestle with Britain over a battery gigafactory for Jaguar Land Rover.

At least Chancellor Jeremy Hunt and the Trade Secretary Kemi Badenoch are now focused on addressing the fundamental problem – a lack of sufficient battery capacity in the UK.

And this is in sharp contrast to Starmer. Labour seems to think the solution to all the UK’s complex industrial and trade problems is to cuddle up to the EU in defiance of the will of the people.