Examination of Witnesses (Questions 60-79)
24 MARCH 2004
MR PAUL
EVERITT, MS
KATHERINE BENNETT
AND MR
MIKE HAWES
Q60 Mr Challen: It is like saying you
only go as fast as the slowest. Could there be a future competitive
advantage to meeting these targets earlier than other people so
that you can get in with new technology and beat other manufacturers
in other parts of the European market?
Ms Bennett: You need to appreciate
that most of the big car companies research and development is
done centrally. We do not just design and build cars in this country,
we sell cars across Europe that are designed and researched in
the technology developed all over Europe, it is not just a United
Kingdom developed car which is brought to the market.
Q61 Mr Challen: What does that say about
the United Kingdom Government's desire to have all of these targets?
Ms Bennett: We work with the Government
to help set the targets.
Q62 Mr Challen: For the United Kingdom?
Ms Bennett: Yes.
Q63 Mr Challen: Then we are back to the
market saying, "Why do we have all these targets?"
Ms Bennett: You have to have targets.
Q64 Mr Challen: Only if they are going
to be sensible and smart, and all of the rest of it.
Mr Everitt: I do not think we
are trying to suggest there is something wrong with the 10% target.
What we are saying is it needs to be seen alongside the broader
European agreement and the opportunities in the United Kingdom
are not so much, if you like, in the vehicle but the technologies
that that vehicle will use. There are great opportunities and
ones that we as the SMMT are keen to encourage the exploitation
of and generate within the United Kingdom a supplier base of technological
excellence to take advantage of that. All of these major car companies
are looking for ways and means of improving efficiency which they
will be able to supply.
Q65 Mr Challen: If I came to either of
the manufacturers here and said, "Could I buy a petrol or
diesel car which meets this target now?", could you sell
me one?
Mr Everitt: Yes.
Ms Bennett: Yes.
Q66 Mr Challen: They are available?
Mr Everitt: It is feasible. We
know there are vehicles available today that are less than 100
grams per kilometre. I have to tell you that not very many of
them are being bought and that is the issue.
Q67 Mr Challen: Is it price?
Mr Hawes: It is a combination,
it is price, it is the utility of the vehicle. Coming back to
the consumer, it is motivation behind choice, by and large consumers
do not rate environmental performance very highly on their criteria
in determining to buy a car.
Q68 David Wright: They do on other products.
If you go into a retailer to buy white goods, one of the things
which is on white goods these days is a sticker on the front of
it which gives it a rating. When I go and buy a fridge I look
at that rating and I decide how I am going to weigh off the comparison
between the cost and the advantage to the environment, a conscious
decision is made. When are you going to badge your vehicles in
a similar way?
Mr Everitt: The motor industry
introduced voluntary environmental labelling in 1999 which highlighted
CO2 emissions, that was superseded by a European directive which
meant we had to slightly change the label. We have been labelling
vehicles with CO2 information since 1999.
Q69 David Wright: I do not remember wandering
round the car dealers in my constituency when I bought my last
car seeing any particularly high profile advertising—it
was not one of yours, a terrible shock to you, I know—I
do not remember seeing anything.
Mr Hawes: It is a requirement.
Q70 David Wright: —a very high
profile campaign on this issue.
Mr Hawes: It is a requirement
to display that label.
Q71 David Wright: About two millimetres
high.
Mr Everitt: A4.
Ms Bennett: Perhaps it comes back
to what I was saying earlier, we do extensive market research
and in the list of priorities for a customer the environment is
number eight or nine. Number one is cost.
Q72 David Wright: Surely you have a responsibility
to lead in terms of public opinion as well? We are talking about
the global market now, there are increasingly less players in
the car manufacturing market and you have to take on and deal
with corporate responsibility now as global companies. You have
to lead the market as well as follow it.
Ms Bennett: We bring environmentally
friendly vehicles to the market and have advertising marketing
which supports that. I promise you we do advertise extensively
on environmental issues, but you can image the discussions which
go on in our head office in Luton when you are looking at an advertising
campaign promoting the economic benefits of the car or other customer
benefits, and our marketing people have to balance that up. The
environment is one of the issues which we do push on but there
are other benefits which customers look at.
Q73 Mr Challen: I am sure you will not
market cars on the basis of speed, I am sure that never appears
in an advert.
Ms Bennett: That is actually against
the law.
Q74 Mr Challen: It is done very, very
subtlety. In the Powering Future Vehicle Strategy a zero emissions
target is set for 2020. That was not set at that time, is that
target now being set?
Mr Everitt: As I recall the Powering
Future Vehicle Strategy asked that the Low Carbon Vehicle Partnership
view what might be appropriate for an ultra low carbon car target
for 2020. The Low Carbon Vehicle Partnership is an advice body
outside of Government which includes vehicle manufactures, component
suppliers, energy providers as well as NGOs, local government
and a range of other stakeholders. There was and has been a discussion
on whether it is appropriate and possible to set a realistic target
for 2020 and the view which was taken by the Partnership was that
at this point in time there were so many technologies being developed,
there were so many areas of investigation underway it was not
possible to come up with a rational and dependable 2020 target.
Where we are at the moment is very much on the cusp of what might
be a very significant change in the sense of vehicle technology.
The speed of which that change is likely to take effect is something
which no one is really in a position to make a sensible judgment
on. It was thought better to keep the situation under review rather
than pin a number up on a board which had no value.
Q75 Mr Challen: That is being kept under
review, when do you think a decision might be likely?
Mr Everitt: That is the reason
why it is under review. If we could say it is going to be this
people would go with it. At the moment the view is that we simply
do not know. We have some significant and challenging targets
to reach in terms of 2008 and indeed 2012. I think the closer
we get to the 2008 situation it will make it slightly clearer
about where we might get to in terms of the 2020 target.
Q76 Mr Challen: I was wondering how the
review worked, are you able to revisit on an annual basis?
Mr Everitt: Within the Low Carbon
Vehicle Partnership it is an on-going monitoring which they do.
The 2012 target is discussed on a regular basis, the progress
is discussed on a regular basis and the opportunity to make it
a review and advise on that is an on-going issue.
Q77 Joan Walley: Innovation is very much
the watch word and the key word and just referring to the Powering
Future Vehicles Strategy I wonder if you can tell us whether or
not you feel there are too many organisations involved? Is there
a need for one organisation, one port of call? How is it all panning
out, how is it all working?
Mr Everitt: It is true there are
a number of organisations and there are a number of different
funds and tasks. The first thing to state is that we should not
over-estimate the potential. The major investments into R&D
on vehicle technology are clearly being made by global companies,
vehicle manufacturers and component suppliers. However, there
are significant opportunities for leveraging investment into the
United Kingdom and thereby the various programmes from the Foresight
Vehicle Programme to the New Vehicle Technology Fund and the Ultra
Low Carbon Car Challenge are all means by which they serve some
direct benefit in terms of pushing the agenda along by providing
important R&D and/or opportunities for demonstration projects
but also, more importantly, they draw in the United Kingdom based
supply chain and mix them with the experience within academia
and some of the global car companies. It is a complex situation
but I think broadly people understand what the different programmes
are for. Since the publication of the Powering Future Vehicle
Strategy there is a better understanding and greater co-ordination
within Government itself. We now have the ministerial group with
DTI, Defra, DfT and Treasury. There is a greater internal cohesion
within government and that has benefits of allowing those people
outside government to be a bit clearer on what is going on.
Q78 Joan Walley: Given it is a big maze
for people to find their way around, do you agree with the recommendation
that there should be a single point of advice and information?
Has there been any progress on that? Are we likely to see a single
one-stop-shop point of contact?
Mr Everitt: In general terms the
SMMT is very keen for business support programmes to be very much
of the one-stop-shop variety. Given some of the organisations
are relatively new, certainly the Low Carbon Vehicle Partnership
is relatively new, some other organisations are perhaps more established,
the Energy Saving Trust and indeed the Carbon Trust. I think there
may be—
Q79 Chairman: You are doing well, we
have it all written down!
Mr Everitt: I am not making a
good argument that it is all hanging together very well. It would
be safe to say there is scope for some better co-ordination.
Ms Bennett: The other complication
is the RDAs. We talk about innovation in the different regions,
for those of us who have sites in different parts there is a wide
diversity of research grants on offer. We certainly agree with
the one-stop-shop approach. We do think the partnerships which
have been set up so far seem to be working but the regional aspect
can be confusing.
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