Part of 4. Topical Questions – in the Senedd at 4:00 pm on 16 October 2019.
Can I thank Dai Lloyd for his questions and, first of all, say that I disagree with your assessment about the support that the Welsh Government is giving to manufacturing in Wales and the importance of innovation? We're just about to open the doors on the advanced manufacturing research centre in north Wales. That will be a unique research centre. Indeed, your own Members have called for an AMRC in Wales. I hope that you'll be supporting its launch in November.
We have Europe's finest, if not the world's finest, compound semiconductor cluster; we have M-SParc, again in north-west Wales; we have Aston Martin Lagonda, who have decided to make south Wales the home of their electrification programme. There is innovation across the length and breadth of Wales as a consequence of the strategic investment by this Welsh Government. That investment is futureproofing our economy. But the position that this company found itself in was such that it could not survive without important contracts from Honda. Their troubles were compounded by a decision by Volvo to adopt an engine that would use an electric transmission that would not require cabling. Those two factors put the company's future in jeopardy here in Wales.
The Member identified examples in Ottawa of success, but the obvious difference between Ottawa and Wales is that Ottawa is not currently in the European Union, facing crashing out, and this is a major threat for the sector. And if we look at other businesses across the UK right now, that survey that I mentioned earlier, we'll find that 11.8 per cent of firms in the automotive sector, almost 12 per cent of businesses in that important sector, have already divested from UK operations. The sector is potentially at the point of meltdown as a consequence of the indecision, inaction and the failure of the UK Government to actually act to support it. And, as I said, tomorrow I will be pressing the UK Government to back up positive rhetoric about the future of the automotive sector with hard cash for the Kingfisher fund.
I think there are two major opportunities in south Wales, in terms of the transition that the Member identifies, and I would agree that we do need to have a seamless transition to, if you like, new automotive sector activity within south Wales. First of all, the obvious opportunity is with alternative propulsion systems—most obviously electric, but also, potentially, with hydrogen. We're working on those opportunities, not just with the Wales automotive forum, but also, I have to say, with BEIS at a UK Government level, trying to attract as many investment opportunities as we possibly can and challenge fund grants as possible to Wales. The other big opportunity, Llywydd, concerns the lack at the moment of recycling facilities for batteries, and also for composites. So, again, we're looking at opportunities for this region to capitalise on that shortage of such facilities.