In 2017, car manufacturers and their suppliers invested £1.1 billion into the UK motor industry: new equipment, new robots, new factories and so on. Unfortunately, the figures for 2015 and 2016 were £2.5 billion and £1.7 billion respectively. In the short term, this near-60% collapse in 2 years means fewer jobs making the equipment and building the factories. In the longer term it won’t matter if the downturn proves a short-lived consequence of waiting for politicians to sort out Brexit. Perhaps after it is sorted there will be a rush to make up for delayed investments. Sadly, there’s also a distinct possibility that clarity over Brexit will cause a further lurch downwards in the industry’s investment into UK car production.
Investment matters because business decision-making is all about the future. It may be a short-term future based on trying to make loads of money in the next few months, but for most businesses it’s a longer-term consideration about where the business should be in 2–5 years time.
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