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Rt. Hon. Peter Mandelson - Former Secretary of State for Trade and Industry (Jul 1998 - Dec 1998)The SMMT Industry Forum |
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Delighted to be at the NEC to-day to attend the Industry Forum Showcase event and to give me an opportunity to visit the Motor Show. I am particularly pleased to have this opportunity so soon after my arrival in DTI to put the promotion of enterprise at the forefront of my agenda. It?s become a cliche to say that we are living in a fast changing and increasingly uncertain world. But it is true. Look at product life-cycles, for example. They are shortening every day. During my visit to Silicon Valley last week, I was told that some products are now out of date within 12 months of first conception. Only the truly enterprising and innovative can hope to achieve such rapid and constant change. I believe that the automotive industry is one of the best placed in Britain to take up this challenge. Car sales in the UK have been undergoing a renaissance. This is not surprising. The British love their motor cars. Sales in 1997 were at their highest level since the mid 1980?s, and the third highest year on record. And I understand that the latest figures for September are expected to show that sales will be almost 6% up on the same period last year, reflecting a similar trend across Europe. Car production is similarly strong with output in 1997 at its highest level for 24 years. But despite this good news, I know that the external environment is difficult in some respects and uncertain in others. Your industry has some difficult decisions of its own to make to become truly competitive. Recent announcements of down-time and job losses are a reflection of the industry?s continuing challenge to remain competitive in the global market. But it is also a matter of fact that the global market will continue to become more competitive. We cannot stand still, because the competition certainly won?t. The pace is not going to let up. And those of us in government - here and elsewhere - must seek to do what we can to help you to boost your competitiveness in the future - and we will. The nature of the global market demands modern companies that are constantly moving forward, with new products, new innovations and new technology - always combining higher quality and better delivery performance. And all this at lower cost. Improvements in productivity and quality will always be vital. They may not solve everything. But leading companies know that without them, you won?t even be playing the game in the next century. Which is why the work of the Industry Forum is so vital. Here we have an initiative established by the motor industry for the good of the motor industry. An initiative that recognises that world class vehicle manufacturers need world-class supply chains. An initiative that recognises the challenges ahead, the need for excellence, the need for continual improvement, the need to learn from the best in the world. And one which is delivering hard, measurable results in quality, cost and delivery performance in all the companies concerned. You will hear more about some of those successes during the course of the day. But I would like to whet your appetite now by saying that some of the results are astonishing. Right first time quality up by two-thirds. Productivity doubled. Stock turns more than trebled. Who could fail to be impressed by these achievements? These results have certainly been noticed by others outside the automotive industry and overseas too. Of course, I know that all this has not come about by itself. It has required a lot of hard work, driven by a dynamic and creative partnership between the industry, the SMMT and the DTI. And it has developed on the back of generous support from many in the industry. I would like to make a special mention of those companies who have provided the expert Master Engineers to train the young British engineers, and those who have provided the vehicles, the premises and the support staff. They have demonstrated their commitment in the most practical way possible. And I express my thanks. And I am delighted that the DTI has been able to play its part. We have already committed nearly £4 million to the scheme, but to-day I can announce that we will be providing an additional £2.5m to build on the success achieved to date. This will enable the Master Engineers to stay on for a further two years, to demonstrate and pass on some of the more advanced techniques and to ensure that the activities they begin continue after they have returned to their own companies. This is our best chance - perhaps our only chance - to ensure that the knowledge and techniques the Master Engineers have brought with them are exploited fully to the benefit of us all. Transferring knowledge through the movement of skilled people is a key - perhaps the key means - of driving innovation. This is what the Industry Forum does and this is why it is a perfect example of a theme I want to make central now to the DTI; that of the knowledge driven economy. Knowledge comes in many shapes and forms, from blue-sky research to practical experience and expertise. The key is in recognising it, generating it, harnessing it, and then applying it. The key to world class process improvement and supply chain improvement is not just knowing what to do, but how to do it. There are, after all, plenty of text books on the subject. But knowing how to introduce it, and then sustain it, on your own shop floor, needs the in-built knowledge and understanding that comes from years of experience. We need to recognise that fact, and exploit it more widely. And the Industry Forum has demonstrated amply that know-how is not just for those involved in research and development. It?s for those involved in every stage in manufacturing too. It is about how to achieve new levels of productivity, new benchmarks of quality, new standards of product introduction. There are no such things as low-tech industries any more, just low tech businesses. Harnessing knowledge, applying innovation and exploiting new technology is the best way forward for all; young and old, new and established, manufacturing and services alike. We must all work smarter. Not harder, but smarter. I would like to issue two challenges to-day. The first is for those companies who have not so far participated in the Industry Forum. You have here a golden opportunity to learn from the best in the world. Don?t let it pass you by. Seize it. Make the best use of what is available. And the second is to other manufacturing sectors. In my forthcoming White Paper on promoting this country?s competitiveness, I will be encouraging other industries to build on your impressive example, to emulate what you do, to take your best practice, and apply it to their own indsutries. I want other sectors to develop sector-wide business improvement activities, to identify world class best practice, to ensure that people are trained in its practical application throughout the supply chain, to measure the results - and then to sustain that improvement into the long term. And what is good for the private sector is good for the public sector too. We will need to respond to the particular needs of the sector in question, and my Department stands ready to support the best proposals. The automotive industry has demonstrated that it can face up to the challenge of competitiveness. But the challenges don?t stop there. Your voice needs to be heard on the range of issues raised in Transport White paper, and I know that you understand the need to respond speedily and constructively to the consultation exercises underway. Closely linked to that debate is the need for the industry to continue to demonstrate its environmental credentials. I am particularly pleased that the vehicle manufacturers have recently been able to reach a voluntary agreement on reducing CO2 emissions from passenger cars. This will make a substantial contribution to the UK?s Kyoto target and our domestic CO2 reduction target. I understand the pressure that environmental regulation imposes on your industry, and we have seen how the vehicles industry can respond positively in the case of CO2 and on recycling. But the key to success is staying ahead of our international competitors. That is why my Department is just as concerned about, and alert to, these issues as those parts of Government which are more traditionally associated with the environment. I am pleased at the way the industry has responded so positively to the work of the Cleaner Vehicles Task Force. This group, run jointly by my Department and the Department of Environment, Transport and the Regions, and launched by the Prime Minister last year, will have an influential role in helping to frame our future environmental policies for cars and for other vehicles. The car is, and will continue to be, vitally important in providing mobility to people and contributing to the wealth of the economy. But we need collectively to ensure that, while maintaining the benefits it offers, we can minimise the impact it can have on the environment and health. The work of the Task Force over the coming months is therefore going to be vitally important. And research and development will continue to play its part, not only in helping to address environmental concerns, important as those are, but in facilitating the increasing integration of new communications and information technology into the vehicles of the future. The vehicles that will appear in the Motor Shows of the next millennium. That is why I am delighted that we were recently able to announce a further £5 million for the highly successful Foresight Vehicle LINK programme. This will take forward the work already under way looking at the technologies for the mass market vehicles of the future; technologies that are clean, efficient, light-weight and telematically integrated into the transport system. Indeed, I?ve already seen this in many of the models I?ve seen this morning - a blend of the best of computing and emerging telecommunication technology with the traditional quality of automotive engineering - which we need to do to maintain its share of the world market. We can only meet the challenges if we work together, and if we aim to learn from the best, and to be the best. To-day?s show-case event is an excellent example, not only for your own industry, but to others in the UK. I am delighted that my Department is able to support you in this work, and wish you a successful and enjoyable conference. We are right behind you, and all you?re doing and right behind the industry. |
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Other speeches by Rt. Hon. Peter Mandelson - Former Secretary of State for Trade and Industry (Jul 1998 - Dec 1998)
(the following are available from the archive) |
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