Over the last thirty years, UK manufacturing supply chains have become increasingly ‘hollowed out’ – that is to say whilst the UK continues to boast major manufacturing success stories like our automotive and aerospace sectors – the supply chains upon which even these sectors are based are increasingly dominated by the supply of imported components and materials. Since the 1990s a combination of globalisation, the growth of manufacturing sectors in developing economies, the relative strength of sterling, gaps in support for innovation and commercialisation, and less emphasis on technical education has eroded the UK’s industrial capabilities, and weakened our domestic supply chains.
The UK faces competition not just from the increasingly cost effective manufacturing from abroad, but from well establish sectors in developed economies such as Japan, Germany and France – modern innovative sectors that have invested more heavily in their manufacturing sectors, and supported in doing so by supportive public policy frameworks and long term industrial strategies.
The UK’s membership of the EU has both facilitated this and moderated its impact. As all trade and regulatory barriers were gradually removed, supply chains across the EU become increasingly integrated and interdependent. Components and materials can be sourced as easily from elsewhere in the EU as they can from within the UK.
But with Brexit on the horizon; are the UK’s hollowed out supply chains going to become more of a problem? Are their growing structural weakness going to become more marked? Will new trade frictions with the EU lead to UK reshoring, or a further decline in supply chain strength? How will manufacturers meet new rules of origin requirements in UK FTAs? And what wider trends in manufacturing, not least 4IR, could help us in this challenge?
Join UK Steel at the Make UK National Manufacturing Conference 2020 on the 25th February in London where we have assembled a fantastic group of speakers to look at these questions, provide expert opinion, and engage manufacturers in a topical discussion about manufacturing supply chains and the increasing importance of their locality.
Find out more and book tickets at www.manufacturingconference.co.uk
PHOTO CREDIT: process underbody 24, taken by Jakub Wasik. Winner in the Amateur category of the EEF Photography Competition 2017