“Internal and External environmental audit” of the automobile industry in the UK using PESTEL and SWOT frameworks.
Britain’s automobile industry dates back to the late 19th century, when Daimler began manufacturing cars. Today, the UK is a major automobile and automobile part manufacturing hub and home to seven major car manufacturers. It produces a wide range of standard specification, premium and specialist vehicles, including Formula One cars and sports vehicles.
An analysis of the industry using the PESTEL (Political, Economic, Social, Technological, Environmental and Legal) framework is carried out below:
Political: The automotive industry has always received political support on account of several factors such as employment potential, export earnings and membership of the European Union. The Government has signed free trade deals with Singapore and also benefits from the EU-South Korea trade agreement. The UK is increasing exports to emerging economies in order to boost exports. This has attracted new foreign investment to the tune of GBP 6 billion from BMW, Jaguar Land Rover, Nissan, Ford and others. UK-manufactured cars sold within the EU are exempt from customs tariffs and are therefore cheaper.
Economic: The UK is now the second largest car producer in the world after Germany. It exports 25 per cent of the cars it manufactures and provides 730,000 jobs. In terms of value, automobile exports stand at a staggering GBP 27 billion, helping to reduce Britain’s large trade deficit and constitute 11 per cent of all manufacturing exports. 51 per cent of the automobile exports are to EU countries on account of absence of trade barriers. The UK is also making efforts to establish a presence in emerging markets like China and India. The presence of a vibrant car components and engine parts industry supports car manufacturers in logistics by enabling faster