British manufacturing/engineering post you know who..

CambsNewbie

I know a lot of this has been covered already in the 'funeral security' thread and others but..

To me it seems that one of the arguments the Left use to bash Thatcher/Thatcherism/Tories/the Right is that they destroyed British manufacturing and engineering. I am 39 and can't remember a political life before Thatcher came to power so I can't personally compare the before and after.. But to me manufacturing still seems a very important part of the British economy with some very successful British companies and sectors.

Eg car manufacturing. Toyota, Honda and Nissan have all set up successful plants in the UK. Yesterday I read in Autocar that Nissan's Sunderland plant produced more cars last year than the whole of Italy and is one of the most efficient factories in the world. It seems every two days Jaguar/Land Rover are announcing they are taking on more staff,selling more cars and making more profit than ever before. At the prestige end of the market Rolls Royce, Bentley and Aston Martin are all doing well. The Mini factory in Oxford can't produce the cars fast enough and so BMW have taken over an old Volvo/Mitsubishi factory in the Netherlands. I accept that these car companies are no longer British owned but from the factory to the supply chain to the dealerships supply massive employment.

Ford produce nearly all the engines for their European market in UK factories, all BMW 4 cylinder engines are made in the UK. Rolls Royce aero engines are recognised as being the best in the world and the company has a massive order bank. JCB are still doing well despite the global slowdown in building. Although foreign owned many of the top formula one teams are based here. Airbus produce all their wings here.

I know dyson no longer manufacturer here but they still engineer all the products in the UK. Around Cambridge are some of the worlds most successful micro-chip companies.

These are just some of the companies I could think of whilst I was in the shower (my thinking time!). I'm sure there are many others. Is this considered to be 'destroyed'? I appreciate factories no longer employ thousands of workers like they used to but isn't that just progress (whether you see it as good or bad)? Would the British consumer be prepare to pay significantly more on some products just to keep Steve down the road in a job? And if British manufacturing has been destroyed is it not the fault of the British consumer who when going out to buy a tv/fridge/car wants the best for the lowest possible cost regardless of where it comes from?

As wages and costs increase, isn't it inevitable that labour intensive work eg manufacturing will constantly move to where-ever its cheapest? A lot of companies who moved from Western Europe to Central Europe to take advantage of lower labour rates when the Communist Bloc collapsed are now looking at moving further east as labour costs in Central Europe become comparable with the West. Isn't labour going to going keep moving to the cheapest point until we all have a similar living standard?

I admit I have done no research on this at all so I am prepared to be shot down in flames! I guess my two main points are why don't we celebrate the world class manufacturing we do and what happened in our labour market was inevitable regardless of who had been in power?

finchy

This is one of those things that is only partly under government control. If you want to play around with the following data, you can look at the % of our GDP re-invested in research and development over the years and compared to other countries:

http://data.worldbank.org/indicator/GB. ... /countries

Evidently there is some government influence in there, such as tax breaks to fund R&D, university spending, etc. but business culture also comes into play - are business owners going to take a long-term or a short-term view on developing new technologies? There is also education - how good are the universities at turning out those who are talented enough to design new products?

I find it interesting that per capita, the UK turns out more scientific and technical articles than countries like the USA, Japan, Korea and Germany yet have far fewer patent applications.

The Little Onion

A few points
-Manufacturing, as a percentage of our GDP, has declined massively in the last few decades, in part because there was no government industrial policy under either conservative, labour, or coalition governments (other than to just let it rot, except in a few key sectors such as defence). We do some stuff well, but not the amount that we used to. The decline is greater than other European countries.
-Other similar countries (e.g. France) have maintained heavy industry, so that whilst the global challenges relating to cheap labour, rise of the far east etc, would have hit British manufacturing irrespective of who was in charge, it does not necessarily follow that decline was inevitable. It is just a question of what policies would be needed to maintain it at a particular level, and whether such policies would have been justified.

Monty Dog

The Little Onion wrote:

-except in a few key sectors such as defence

I work in the defence sector and look after some projects related to skills and even here there has been chronic under-investment to the degree it's constraining capacity and therefore GDP. We live under the eternal threat of foreign companies bidding for UK work, yet UK companies have little chance of winning work in other EU markets due to their own protectionist policies.
In certain technologies, we are world-beating but it's often easier to attract investment overseas as UK investors are looking for short-term gains. Lack of government support hampers export efforts.
The only people training nuclear engineers has been the navy for the last 20 years such that we haven't even got a skills base to consider a domestic nuclear power programme without importing skills from France or Germany.
Successive administrations have fought-shy of any form of sectoral industrial policy - just think of how many new jobs could have been created with the money spent bailing out the banks?
On the upside, we had 1500 applicants for 50 apprenticeships...people want to work in our sector because the jobs are interesting and relatively well-paid, but those in Whitehall are more interested in what's in it for them and securing lucrative jobs as non-execs and consultants.

elbowloh

Toyota, Honda Nissan Jaguar/Land Rover, Rolls Royce (auto), Bentley Mini BMW.

Like you say, they're all foreign owned. Which means, yes they may provide jobs, but the profits leave the country, we often have to offer very attractive subsidies/grants to these companies to set up factories and I wouldn't be surprised if some of them had schemes that limited their tax exposure in the UK.

Having said that, the british owned automotive companies had run themselves into the ground through poor management and a refusal to change and innovate.

You're also right to highlight R&D as we have some of the best engineers and designers in the world in this country, real first class stuff, which is why the likes of Nissan and BMW have design and research hubs in the UK. We're never going to compete with the labour markets in the east, so we should be focusing on the hi-tech and R&D, and we do to an extent, but I don't think there is enough fundng currently to support this.

Also agree with Monty Dog, when it comes to the EU, we do play with a straight bat, opening up our markets to firms from the rest of the EU, with UK companies often losing out to continental firms on big contracts. It doesn't really happen the other way round. Just look at Crossrail. Currently the biggest engineering project in Europe and the 2 biggest contracts (for the 2 main tunnels) have gone to 2 spanish construction companies (albeit as part of JVs), when there were many UK based companies with more than enough ability to do the job.

I have some experience of this as I was an engineer at the Honda plant in Swindon for a while (although somehow i now work in civls, and before that rail).

Jez mon

I think part of the problem, is that everyone says that there's no manufacturing industry, and it becomes a self fulfilling prophecy.

disgruntledgoat

The UK has some excellent process and construction engineering expertise which it unfortunately declines to invest in or utilise.

ballysmate

I am old enough to remember the 70 and British Leyland and all that. The cars were poorly designed and poorly made. Think of model like Morris Marina, Austin Allegro, Austin 1800 and the Maxi and you get the idea. The production was beset by industrial action for spurious reasons (Red Robbo, anybody) and management was poor.
Ford cars were better but still poor. I had a Mk3 Cortina and anyone who owned one, could remember virtually being able to watch the front wings rust.
In the late 80s/early 90s, I had a 1984 Jaguar XJ6. Beautiful looking car, but the technology had not changed much from the XK range of the 50s.
We all scoffed when Datsun (Nissan) cars started arriving from Japan in the late 70s. But they turned out to be well made and reliable. Then the Japanese wanted to set up factories and we scoffed again. Japanese practices and management style.... pah! The rest is history.
I see the merit of trying to support the manufacturing sector by buying British, but it also incumbent on industry to produce products that are worth people's hard earned cash. We used to see campaigns urging us to buy British but I seem to remember that even then, Ford cars built in Germany rather than the UK were regarded as being superior.
My old man had a new Vauxhall, but when rust began to appear, wished he had gone for an Opel equivalent. Sad but true.

ballysmate

The campaign to 'Buy British' also resulted in Japanese electrical companies buying up British companies, predominantly for their brand names. Some people in the 70s still had an aversion to anything Japanese and felt more comfortable buying a 'British' make, unaware that they were in fact buying Japanese.

DesB3rd

I guess there has to be something in the "Europe as a closed shop" idea - have a look a the websites of any of the major UK contractors and most have portfolios containing major infrastructure projects in the US, Australia/NZ and across Asia, all of which must all be market places with well established and competitive domestic industries, but nearly nothing in Europe.

Aside, the old corporatism of the previous era has a lot to answer for, not least in it's inconsistency - stop/start regimes of nationalisation, a casual but fractious relationship with a powerful organised labour establishment, a reactive approach to market pressures etc. We tend to labour the German example but I'll bring it up again - their government (more accurately the grandees of the immediate post-war American administration) set in stone that govt could be generously social-democratic but had no place in controlling/owning the means of production (there was a general disinclination for this anyway due to memories of the business seizures of the 1930s) - and the unions, were kept "in the tent" but prescribed tightly defined areas of concern e.g. no say in the application of technology, manning levels, issues affecting electoral politics etc.

tiredofwhiners

The Little Onion wrote:

Manufacturing, as a percentage of our GDP, has declined massively in the last few decades, in part because there was no government industrial policy under either conservative, labour, or coalition governments (other than to just let it rot, except in a few key sectors such as defence). We do some stuff well, but not the amount that we used to. The decline is greater than other European countries.

Undoubtedly true, but much of what we manufactured pre-1980 was complete sh*t which only the UK bought as we couldn't afford to import decent stuff. Since mechanisation and automation was introduced (not a UK disease but a reality of the 20th and 21st centuries) our labour intensive, high wage, highly unionised industries have declined for the obvious reasons. they were out evolved by the competition and they made themselves obsolete. Those who moved with the times, and di not rely on low grade staff have done well.

France is currently paying the price of its economic policies, and is not the resounding succes they like you to believe. Everyone pays higher taxes to support industries which should have gone the way of the Dodo.

Pross

I've been thinking about this myself recently. As above the decline has been in heavy industry, we still do engineering industry very well. In some ways we are better off without some of the heavy, dirty industries of the past but obviously those who lost employment will probably disagree. It is frustrating when people say we have no manufacturing when in fact we have some of the best low volume, high precision manufacturing companies in the world plus the highly efficient car manufacturing as mentioned by the OP. I also agree on the way things are tendered under EU laws - some other countries are very protectionist but then complain loudly if other countries do the same.