1. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED SMMT, the ‘S’ symbol and the ‘Driving the motor industry’ brandline are trademarks of SMMT Ltd Driving the future: UK automotive delivering economic growth through low carbon development Nikki Rooke, Head of Communications, SMMT 21 June 2011

2. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 2 The automotive industry is a vital part of the UK economy: Produces over 1m cars and CVs and 2m engines each year. Contributes over 10% of total UK exports – typically worth more than £25bn a year. Exports to over 100 markets worldwide – over 75% of vehicles produced are exported. Automotive employs over 700,000 people and spends £1.5bn on R&D each year. Contributes £8.5bn a year of added value to the UK economy.

3. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 3 Why is the UK important to the global industry? Seven volume car manufacturers and eight CV manufacturers. The largest number of specialist sports car manufacturers in the world. A base for 19 of the world’s top 20 suppliers. Eight F1 teams, supported by more than 300 specialist motorsport companies. The UK has the fourth highest R&D spend in Europe and represented a fifth of core global R&D activity in 2010. The UK is home to:

4. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 4 New car registrations The scrappage scheme helped support volumes. Market down 7.3% to May and set to end 2011 at 1.93 million units. New car registrations, 12 month moving annual total 2008 to 2012 (Source SMMT) Market stabilised, at lower level

5. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 5 New car registrations Scrappage in place May 2009 to March 2010 (with some overhang). Represented almost 15% total sales over that period. New car registrations, 2009 to 2011, with scrappage identified (Source SMMT) Impact of scrappage scheme

6. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 6 New car registrations Scrappage scheme supported private market. Fleet volumes stable and driving overall market. New car registrations, 12 month moving annual total 2007 to 2012 (Source SMMT) Private and fleet split ‘000s20072008200920102011 F2012F Total2,4042,1321,9952,0311,9302,012 % change2.5%-11.3%-6.4%1.8%-5.0%4.3% Private1,0468921,014958853888 % change-14.7%13.7%-5.6%-11.0%4.1% Fleet/Business1,3581,2399801,0721,0771,124 % change-8.7%-20.9%9.4%0.5%4.4%

7. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 7 Strengthening production volumes Output stabilising as VMs confirm ongoing investment

8. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 8 Long-term commitment to UK plants Just this year we’ve seen even more announcements: £1.5bn investment in engineering and manufacturing facilities by Ford. £1.4bn investment at Swindon by Honda. JLR to retain all three production sites, creating 1,500 new jobs. £420m investment by Nissan to make LEAF and batteries. McLaren Automotive MP4-12C to be produced in Woking. JLR award over £2bn of supply contracts for the Range Rover Evoque. Next generation Vivaro confirmed for Vauxhall’s Luton plant in 2013. Expansion of the TATA European Technical Centre in Warwickshire. Aston Martin Cygnet production to create 150 new jobs.

9. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 9 Long-term commitment to UK plants And just this year we’ve seen even more announcements: MG6 GT to be designed engineered and assembled in Longbridge. JLR invest £490mn in Solihull for the C-X75 hybrid supercar. Optare opened new 1,200 capacity bus manufacturing facility in Yorkshire. Aston Martin Rapide production moving to Gaydon. Toyota install solar panels to power production of Auris hybrid, Auris and Avensis. Nissan’s £192m investment in the new Qashqai. BMW’s £500m investment across all it’s facilities for the new MINI Coupe and MINI Roadster.

10. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 10 It’s not just about vehicle manufacturers Growing the UK supply chain: About 80% of all component types required for vehicle assembly operations can be procured from UK suppliers. The supply chain represents about 40% of the retail price of a passenger car. The UK automotive supply chain typically generates £4.5 - £5bn of added value annually. Around 2,350 UK companies regard themselves as ‘automotive’ suppliers, employing around 82,000 people. It is estimated that every job in a vehicle’s assembly supports 7.5 elsewhere in the economy.

11. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 11 Moving to a lower carbon transport network Meeting EU legislation: 130g/km by 2015, the equivalent of 58mpg with a diesel engine and 52mpg in a petrol car. 65% of new cars averaging the 130g/km target by 2012 rising to 100% in 2015. Manufacturers exceeding the targets will be heavily fined per additional gram of CO 2 emitted, for every car registered across Europe. Specialist targets for small volume and niche manufacturers.

12. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 12 Moving to a lower carbon transport network Average new car CO 2 emissions keep falling

13. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 13 The emergence of new technology The portfolio approach

14. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 14 UK automotive – driving economic growth A strong future at the heart of the low carbon agenda Low carbon growth through investment in R&D and technology will deliver long-term growth. Supporting suppliers and reinvigorating the automotive supply chain. Attracting international investment and growing business through trade. Increasing skills to equip a new generation.

15. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 15 Automotive Council – www.automotivecouncil.co.uk An industry and government partnership Create a transformed business environment for the automotive industry in the UK to provide a more compelling investment proposition for related industries; Develop further the technology roadmaps for low carbon vehicles and fuels, and exploit opportunities to promote the UK as a strong candidate to develop these and other technologies; Develop a stronger and more competitive automotive supply chain; Provide a stronger public voice for the industry to support the value of the industry to the UK and to global partners; Ensure a strategic, continuous conversation between government and the automotive industry in the UK.

16. SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITEDPAGE 16 Automotive Council – www.automotivecouncil.co.uk Key outputs so far: Consensus Technology Roadmap – mapping the path to ultra-low carbon. Automotive Technologies: the UK’s current capabilities. Automotive Technology and Manufacturing Readiness Levels – Jan 2011. Growing the Automotive Supply Chain: The Road Forward – Mar 2011. Commercial Vehicle and Off-Highway Roadmap – Apr 2011. ‘See Inside Manufacturing’ – 29 June and 10-21 Oct 2011.

17. Society of Motor Manufacturers and Traders Limited Forbes House, Halkin Street, London, SW1X 7DS www.smmt.co.uk SOCIETY OF MOTOR MANUFACTURERS AND TRADERS LIMITED Thank you Contact us: communications@smmt.co.uk