Thank you Mike Hawes (Chief Executive, SMMT).
And good morning everyone.
It’s a real pleasure to join you here at the QEII Centre for what I’m sure will be a fascinating day.
People often remark that the basic format of the motor car has changed little in over a century.
That we still drive around today in four-wheeled, rubber-tyred vehicles powered by internal combustion engines via mechanical drivetrains.
Just like the Model T Ford.
And just like my own 1900 De Dion-Bouton, although my car has a tiller system which predates the modern steering wheel.
But while it may be true that the original design concept for the motor car has proved remarkably enduring, it certainly doesn’t mean that carmakers have lacked innovation.
This is a highly sophisticated industry, working at the cutting edge of modern engineering.
And one that has made enormous technological advances over the decades.
Making cars ever more safe, fuel efficient, and reliable.
But I believe that the industry’s progress in recent years will be overshadowed by what’s to come.
Because we are entering a genuinely new era for motoring.
One that will be every bit as revolutionary as Henry Ford’s Model T or Karl Benz’s Motorwagen.
And it will be revolutionary because for the first time, vehicles and roads will be designed to work together.
Connected infrastructure, autonomous cars, vehicle to vehicle communications, and smart logistics will combine to transform road travel.
The new technology will give drivers an option, whether they want to be in control - or hand the task to the vehicle itself.
It will give us much improved information about journey options and routes…
It will help us find parking spaces.
And fix faults if we break down.
It will save us time, money and inconvenience.
It’ll make our streets safer, and extend the freedom of the road to those currently unable to drive.
And it’ll change the way we manage traffic, so we can make more efficient use of road capacity.
No-one currently driving, or working in the motor industry, will have experienced such fundamental change before.
And this change will also prompt a period of unrivalled opportunity for those who can rise to the challenge.
What UK can offer
We believe we are well placed here in the UK to take advantage of that opportunity.
We have an ambitious vision for roads - which we set out in our £15 billion Road investment strategy before Christmas.
The UK automotive industry is thriving.
Last year, turnover exceeded £60 billion, and you increased production to more than 1.5 million.
That’s a new car rolling off a production line every 20 seconds.
We are also spending £550 million up to 2020 to support Ultra Low Emission Vehicles – or ULEVs.
And to build a charging infrastructure, so 95% of the strategic road network will be within 20 miles of a rapid charging point.
But on top of this, we have world-leading, industry-led capability in automotive and transport innovation.
Ford’s technical centre in Dunton, and Nissan’s Cranfield operation, are just two examples.
And we are building invaluable experience with autonomous vehicle technologies.
We are rolling out smart motorways, which are pioneering some of the technologies that will be developed for driverless motoring in the future.
The result will be continuous smart corridors linking our major cities.
And recently, following a six-month review, we gave the green light to autonomous car testing on UK roads.
Titled The pathway to driverless cars, the review concluded that the UK is one of the best places in the world to trial this technology.
We don’t require special permits.
And we don’t need to restrict trials to test-tracks.
Anyone wishing to conduct tests will simply be expected to comply with a code of practice and abide by the law, so our excellent road safety record is maintained.
In a similar way, when Amazon was looking for a site to develop its innovative drone delivery system, it chose the UK, because restrictions prevented it from testing in the US.
Thanks to the recent review, we now have an opportunity to make the UK a global centre for the design, manufacture and use of driverless vehicles.
We are already working with partners like Williams Formula 1 team and Jaguar Land Rover to develop the technology.
But we want to invite the major car manufacturers to come here to develop and test new models.
Early testing will provide a real competitive advantage in a driverless vehicle market that is estimated to be worth £40 billion globally by 2030.
In July we launched a competition to find UK towns or cities to host the trials.
And just a couple of months later, the Chancellor announced that Greenwich, Milton Keynes, Coventry and Bristol had been successful.
So we are now providing £19 million to fund testing on their streets.
In the Budget, a further £100 million was dedicated to invest in intelligent mobility.
And we are delivering a £150 million innovation fund for Highways England – which until recently was known as the Highways Agency.
That sum includes around £40 million to support driverless and co-operative vehicle systems.
So this government is fully behind the programme.
Roll out of technology
Of course, some aspects of driverless technologies are already common on today’s cars.
Electronic stability control.
And automatic emergency braking are just 3 examples.
But we’re also seeing the development of more sophisticated technologies.
Like advanced cruise control, automatic parking, and lane recognition systems.
And we’re working with the industry to ensure that telematics provides maximum benefits to young drivers.
I’d like to see these features available on all cars.
In the case of automatic emergency braking – insurers tell me they can only take this into account if it is a standard feature – not an optional extra.
The sooner this is standard across the range, the sooner improved safety will be reflected in reduced insurance premiums.
Indeed, Co-operative Insurance analysis suggests that telematics has already led to a 20% fall in crashes involving young drivers.
This process will be evolutionary, rather than revolutionary.
But steadily, autonomous technologies will become more widespread.
We’ve had great success over the past couple of years in stimulating the ULEV market.
Consumers are now buying electric cars for commercial reasons as well as environmental ones.
And indeed, after trying out the Tesla recently, the driving experience alone was enough to make me want to buy one.
(Although there is the small matter of the £80,000 price tag)
In a similar way, the market for autonomous technologies will gather pace with time.
Leading the way will be fleets.
Just as they lead the way in many vehicle innovations.
But logistics operators, car clubs and leasing companies are also likely to drive the early market.
All in all, it’s going to be an area of considerable growth, and hence considerable opportunity for the motor industry.
Conclusion - next steps
The next step is for us to publish a ‘light touch’ code of practice to manage the introduction of emerging autonomous systems.
This was the conclusion of the recent regulatory review - to help establish a clear regime for testing in the UK, supporting industry’s efforts to bring these technologies forward, while also ensuring public safety.
We will be seeking views of the SMMT on the content, shape and structure of the code to make sure that it fits what you – the vehicle manufacturers – need to get testing started.
We know how important interoperability is.
And we are already working closely with Europe to deliver this.
With so far-reaching an issue, a partnership approach between government, industry and highways operators is absolutely essential.
So we build a consensus about how to move forward.
And so you have the necessary support and freedom to do what you do best.
Which is to innovate – and find better solutions to our mobility needs.
At such a crucial stage in the development of autonomous technology, I’m reminded of something that happened almost 120 years ago.
A time when the initial development of cars in Britain had been hampered by legislation.
And in particular, by the Locomotive Acts, and Red Flag Laws.
Which required pedestrians to walk ahead waving a lantern or red flag to warn bystanders of a car’s approach.
And which imposed strict speed limits on powered vehicles.
But that all changed in 1896, when the laws were repealed.
Over the next 17 years, 200 different makes of British car were launched.
Finally industry here had the opportunity it needed to develop new products, and to compete in a rapidly growing market.
Well today, I’m determined that as we move towards a new autonomous age of motoring….
There’ll be no red flag from this government.
Just a green light for the future.