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APC funds from UK to provide impetus to Automotive Industry

Snapshot: APC (Advanced Propulsion Centre) funds from UK are aimed at providing boost to research technologies in the Automotive sector. The biggest team ever from UK was present at the AutoExpo 2016 to convey the message.

Government of UK, in association with automotive Industry are trying to lead the way in the low carbon and efficient technology of the future by providing biggest innovation fund of £1 Billion. The APC (Advanced Propulsion Fund) of £1 Billion was announced in the year 2014 and allocated for a period of ten years to support research and development projects that can create sustainable new and clean technology of the future, while simultaneously creating and sustaining jobs in the auto sector.

The grant for projects and recipients of APC funds are decided biannually, of which Tata owned, Jaguar Land Rover has been one of the beneficiary. For the year 2016, the APC fund of £70 million has been allocated to fuel further growth in the R&D of new projects.

Mr. Lawrence Davies, Acting Chief Executive Officer of the UK’s Automotive Investment Organisation (AIO) spoke to us and shared several specifics, he said that UK is a perfect destination for doing business and as an attractive destination for investment opportunities for Indian businesses. While the new vehicles registrations have decreased in European countries, in the UK it’s on the rise.

Dr. Alexander Evans, the United Kingdom’s Acting High Commissioner to India was present at the trade and investment pavilion at the Auto Expo 2016 in New Delhi and said “Britain had cemented itself as the fastest growing automotive manufacturer in Europe and that meant plenty of growth potential for inward investors. The UK is uniquely placed to return itself to being a global leader in car manufacturing. We are accelerating that position with the quality of our products, and our research and development in the sector.” He also added that “We will continue to boost automotive production in the UK. That means we are looking for more companies to partner with us to satisfy the demand for our cars, and India is well placed to take advantage of this growth.”

In addition to APC funds, £4 billion have been allocated for Tier 1 component production and £2 billion for supply chain opportunities for Tier 2 suppliers and below which would fuel growth and simultaneously create job opportunities in the country. UK manufactured 1.7 million vehicles in the year 2015 for the domestic and export market and its expected that the volumes would surpass 2 million by 2018. To reduce logistics cost and minimise risk, UK-based OEMs need supply chain proximity to cater for R&D cycles that are growing quicker. Sourcing opportunities for automotive component suppliers as identified by the manufacturers would be somewhere in the region of £4 billion per year. 

The manufacturing costs in the UK are lowest in the Western Europe and labour costs are expected to remain more or less same for next ten years, coupled with competitive tax regime, flexible legislation, progressive business environment and developed infrastructure it can prove to be a great place for doing business for India industrialists who are looking for destinations outside India for doing businesses. 

Late American Economist, John Kenneth Galbraith in an interview with Outlook once remarked that it was India’s good fortune to be a British colony. Well, had it not that been that way, how different India would have turned out to be, cannot be said. However, the link between the two countries affects the synergy somewhat to this day and although what India has at hand is not something exclusive, but it is indeed an opportunity for Indian automotive manufacturers and other businesses to explore destinations outside India through an impetus jointly provided by the government of UK and other related industries of the country.

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