The government's drive to put manufacturing at the heart of Britain's economic recovery has gained momentum after Jaguar Land Rover announced a £355m plan to build low-emission car engines in the UK, creating up to 750 jobs.
The UK's traditional carmaking heartland in the Midlands will be the beneficiary, with the factory earmarked for a business park near Wolverhampton. "We expect the engine manufacturing facility to create up to 750 highly skilled engineering and manufacturing posts at Jaguar Land Rover, along with hundreds more highly skilled manufacturing jobs in the supply chain and the wider UK economy," said Dr Ralf Speth, chief executive of the company behind the Jaguar and Land Rover brands, on Monday.
George Osborne's call for a "march of the makers" has been met by weak data in recent months and the embarrassment of 1,400 job cuts at Bombardier's train-making plant in Derby. The car industry, though, has provided better headlines for the government with BMW announcing in June that it will build the new-look Mini at its Cowley factory in Oxford.
Vince Cable, the business secretary, said the JLR investment, along with announcements such as the Mini deal, represented the "dominant narrative" for manufacturing, rather than Bombardier's woes.
"There is a lot of investment taking place particularly in the car industry and the supply chain." Cable said. He added that Britain's manufacturing base should not "put all its eggs" in green technology, but acknowledged the role that environmentally conscious investment could play in the sector's renaissance.
"We are certainly emphasising green investment. Quite a lot of the positive things in the car industry are in the new generation of vehicles with low emissions," he said.
Speth said the new four-cylinder engines would combine high-performance vehicles with lower emissions, as he paid tribute to the "strong support" from the government, trade unions, MPs and local authorities. The deputy prime minister, Nick Clegg, and Cable, are due to meet JLR executives on Monday to publicise the jobs announcement.
Len McCluskey, general secretary of the Unite union, said: "This fantastic news is the culmination of 18 months' hard work by the workforce and Unite, the local council and local MP Jack Dromey, working with Jaguar to bring this plant to the Midlands. A forward-thinking approach and total determination by the local unions to bring new work to the UK ensured a competitive labour agreement could be reached to secure this new plant."
Monday's announcement confirms a turnaround from the darkest days of the recession, when JLR was on the verge of seeking government support and shutting one of its plants in the West Midlands. The Indian-owned company reported pre-tax profits of £1.1bn last year as revenues rose by 51% to £9.9bn, underpinned by strong demand for premium vehicles from emerging markets such as China and Russia. Tata Motors, controlled by billionaire Ratan Tata, bought the company from Ford for £1.5bn in June 2008. The company has already hired 3,000 staff this year, including a record 350 graduates, and now employs almost 21,000 people in the UK.
The Society of Motor Manufacturers and Traders welcomed the move. "Today's announcement that Jaguar Land Rover will build a new low-emission engine plant in the West Midlands is excellent news for UK automotive and comes as the SMMT meets high-profile politicians to promote investment-led growth," said chief executive Paul Everitt. "The government now needs to build on this momentum, working closely with the Automotive Council to help deliver growth in automotive manufacturing and the supply chain."
