• Stephen Odell, Chairman and CEO, Ford of Europe calls for a strategic approach to support manufacturing industry at the European level
   
• Advocates a more pro-industry policy to aid European manufacturing competitiveness in the face of global competition
   
• Calls for a reduction in marginal and unnecessary regulation, and in unbalanced trade agreements
   
• Tells the auto industry that it must become more globally-competitive
   
• Talks of huge opportunity for Britain and Europe in the auto industry – one of the world's growth industries, with 90 million new vehicles a year expected globally by 2020
   
• Re-affirms Ford's commitment to Britain in this, its one hundredth year of manufacturing in the country

London, United Kingdom, June 28, 2011 – Ford of Europe chairman and CEO, Stephen Odell, has called for the creation of a comprehensive industrial policy across the European Union.

Speaking today at the Society of Motor Manufacturer's and Trader's International Automotive Summit in London, Odell commented on the need for a more strategic approach to support Europe's manufacturing industry –  including its all-important automotive industry, which accounts for 10 per cent of all manufacturing by output, and 35 per cent by employment.

He also re-confirmed Ford's continued commitment to Britain in this, its one hundredth year of manufacturing in the country.

Key abridged extracts from the speech are as follows:

On a strategic and comprehensive industrial policy

"We need an effective EU-wide industrial policy: not just for the auto industry, but for manufacturing industry as a whole. That is something I hope the UK government will fully support." 

"Across the EU, the auto industry accounts for 10 per cent of all manufacturing by output, and 35 per cent by employment. It provides direct employment for 2.3 million people, and a further 10.4 million indirect jobs."

"If we can get a policy framework in place in Britain and at the European level that encourages a strong and competitive industry – and if we can get some parts of the industry to make the tough decisions to become more competitive – then I believe that there is a real future for the volume auto industry in Britain and Europe."
 
On the attitude to the auto industry at the European level

"Sadly, we are seeing an increasingly industry-skeptical political environment at the European level, with rising costs of what is often marginal and unnecessary regulation, unbalanced trade agreements, and anti-car European Commission strategy papers on the future of transportation."

On the need for the European auto industry to become more globally-competitive

"Overcapacity was a major problem before 2008, and has only been exacerbated since the onset of recession. In the United States, the industry has undergone a brutal reckoning in recent years, and has come through leaner, more efficient, and stronger. In Europe, nations went their own way. We need improved efficiencies and more competitive business practices to ensure that the European industry can compete in the global arena and play to its strengths." 

"Let me state briefly that I'm firing a warning shot for the established European industry as a whole, not specifically for Ford. We're the No.2 automotive brand in Europe in terms of sales.  We're continuing to invest heavily in the UK and other European Union countries.  We have come through the recession in Europe as a profitable company unlike many of our competitors, though I would welcome a little more profitability. We're here to stay."

On fairness and free trade agreements

"We fully support the principles of free trade. But free trade also must be fair trade. If we eliminate auto tariffs into the EU for aggressive exporting nations, with little or no export potential for the EU in return, then we will seriously undermine auto manufacturing in the EU. This is not just an auto industry issue, but one that affects many other areas of the European economy as well."

"The EU-South Korea Free Trade Agreement is damaging for the EU automotive industry. It gives improved market access for Korean manufacturers in Europe, while export opportunities for European-based manufacturers are likely to remain strictly limited in South Korea. In fact, we're already hearing some disconcerting rumours from Korea concerning the strengthening rather than the weakening on non-tariff trade barriers. This at a time when one of Korea's manufacturers is stating it expects its sales to increase by 40 per cent in Europe over the next few years."

"Against that background, I believe the opening of EU-Japan FTA discussions should not go ahead until the issue of non-tariff barriers to trade is fully addressed by the Japanese." 

On the European Commission's White Paper on Transportation

"The European Commission recently published the EU White Paper on the Future Transport Policy. I have to say I found it to be a hugely disappointing document."


"The proposals outlined in the White Paper – which call for a 50 per cent reduction in internal combustion-engined cars in urban areas by 2030, and a complete ban by 2050 – do not effectively address the issues of congestion and environmental improvement in urban areas. It also effectively proposes to ban cars from out-of-city traffic altogether, by suggesting that such travel should mainly be made by train. Such radical proposals require further discussion and reflection, and they need to respect the principles of technical neutrality and freedom of consumer choice."

"The Transport White Paper is a prime example of policy proposal developed with little regard to the collateral damage it can cause. It could discourage essential R&D in Europe, and significantly reduce employment. We have to consider transport policy not only as part of a wider industrial policy, but also in its effects on energy policy."

On the future opportunities for the European auto industry

"The auto industry is one of the world's great growth industries. By 2020, it's estimated the annual global vehicle market will be around 90 million vehicles. That's 90 million vehicles that have to be designed, engineered and built somewhere in the world. Why not here in Britain and Europe as whole?"

On Britain's changing attitude to manufacturing

"It was a mistake in the 1980s to believe the West was entering a post-industrial age, and it was a mistake to believe this country could focus its economy on financial services. The important thing now is to learn from those mistakes."

"Happily, British policy makers are once again also beginning to see it. I believe they increasingly understand the importance of a strong manufacturing base, and I detect a renewed sense of urgency to re-establish a stronger manufacturing base in this country."

"We fully support the UK government’s goal of rebalancing its economy – putting a greater focus on low-carbon technologies, manufacturing and exports – and we recognise that we have a big role to play in helping to achieve that objective."

On Ford's commitment to Britain
 
"Over the past century, Ford has provided a combination of investment, recruitment, employment, engineering, innovation, manufacturing and sales that is unmatched in its support of the UK economy."

"At Ford we’re investing a further £1.5 billion in UK operations to support future low carbon and high value R&D and manufacturing. This will be concentrated over the next five years."

"Every year we spend $3.5 billion with our supplier base in the UK, and export some $2 billion worth of vehicles, engines and services to markets around the world. We directly employ more than 15,000 people – many in highly skilled roles – and altogether around 100,000 who work in our supplier base and dealerships."

"Between them, our Dagenham and Bridgend plants build about two million engines a year – enough to power almost one-third of all the Ford vehicles sold globally each year."

"Today, I’m proud to say, we’ve put the UK at the forefront of high-tech powertrain development, with engines that are smaller, lighter, more fuel efficient and cleaner.

On the skills base in Britain

"The UK has fallen behind its rivals in educational qualifications. We see a poor take up of science, technology, engineering and mathematics. Too many British students shun rigorous, demanding subjects. Our rivals, meanwhile, provide the kind of educational infrastructure that develops a skilled workforce."

"At Ford we are beginning to recruit again after several years of belt-tightening.
We are looking for skilled engineers in our universities, and last month announced a £1 million programme to sponsor 100 scientific, technical and innovation scholars to encourage that process."

On the future of the British auto industry

"The UK can be a centre of excellence for the new low-carbon and high value technologies that offer the most growth potential for higher cost European economies."

"We have here the potential to build upon world-class design, engineering and manufacturing expertise. But I worry that we will not achieve that potential unless there is a greater commitment to help deliver a stronger British auto industry. The industry is prepared to make big investments. Do our politicians believe in that future as much as we do?"

# # #