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Automotive industry in the UK owned by foreigners offering economic lesson.
Legend Duncan Weldon media reports on the revival of the automotive industry.
The supply of Pfizer AstraZeneca has created a political storm around foreign ownership of British companies.
The attempted takeover of the drugs company in the UK by the US company has been portrayed by some as a threat to the scientific basis of Britain, to jobs and long-term spending on research and development.
Opponents of the agreement are quick to point to recovery in 2010 Kraft Foods Cadbury.
In this case, the merger was soon followed, despite assurances by the closure of a large plant with several hundred job losses.
But there is a part of the British economy, which shows the potential of foreign ownership in a very different light.
The collapse of MG Rover in 2005 left the British car manufacturing sector dominated by foreign companies.
These companies have turned around a once regarded industry as the classic example of the status of Great Britain as an economic failure.
Auto production was hit hard by the global recession in 2009, car production in the UK fell below one million for the first time in decades.
Image copyright Reuters Image Caption could lessons automotive alleviate fears about AstraZeneca agreement.
But since then, the production increased by more than 50 years and the League of car manufacturers and traders predicted it reached a record of more than two million in 2017.
The British car industry employs nearly 130,000 people and generates more than 10 billion per year to the economy.
Its current growth is exactly the kind that policy makers are trying to encourage in the economy.
It creates jobs outside London and the South East, is the heavy investment and export-led, with about four out of five cars made in Britain are for overseas markets.
Mike Wright, Executive Director of Jaguar Land Rover belonging to Indian notes three reasons for the revival of the industry a high-quality workforce, the adoption of global production systems and the support policy of the British government by the Council of the automobile.
In the 1970s, the automobile industry was still mainly British ownership It is characterized by hard labor, under-investment and poor management often.
Many of the cars driving on the production line were known to be of poor quality.
Image Caption The automotive industry in the UK has been transformed since the 1970s.
The industry began to change in the 1980s that Japanese car companies, starting with Nissan in Sunderland, began producing vehicles in the UK.
Foreign ownership in the automotive sector has been associated with improved management techniques, a higher level of efficiency and sharing of global best practices.
The overseas property can often open up new sources of financing for investment.
Lee Hopley, chief economist of the EEF, the body of the manufacturing trade, said foreign ownership has benefited portions of the production in terms of development and investment focus on the internationalization of the company - to to improve its export performance and therefore productivity and overall efficiency.
The productivity in the automotive industry has improved significantly since the 1970s.
Image Caption cars in the 1970s were often known for their unreliability.
However, foreign ownership can have an under-appreciated for industry drawback.
While car output figures are back early heading towards the levels of the 1970s, the wider supply chain is much smaller than it was 40 years ago.
A study of 2012, about 40 valuable components in a British car manufacturing are of domestic origin.
In contrast, Germany and France about 60 parts come from the domestic supply chain.
The high content of British-made car imports had a significant impact on the trade balance of the sector.
In 2012, the UK has a trade surplus on finished cars for the first time since 1976, the value of British built cars sold abroad exceeded the value of cars built abroad purchased.
But the inclusion of components, the automotive sector as a whole is still a large net importer.
Professor Karel Williams of Manchester Business School, says the weakness of the domestic supply chain has been fueled by the model of foreign ownership.
In some cases, the supply chains of large companies operating in the UK are plugged into global supply chains based in their home country.
So while auto production and exports are rising, sucking in more imported components.
Prof Williams said he is not only on the number of shiny cars off the line, it is about the amount of British componentry under the hood.
And the problem there are cars in the 1970s were essentially 100 British and the percentage is much lower.
If you correct the imported content, we will still only produce something around two thirds of the value of production that we have produced in the 1970s, and probably much less than we produced in the 1990s late.
Fourteen of the 15 largest auto parts companies in the world are based in Germany, Japan, the US and France - all countries that still have a large domestic producer owned.
Prof Williams argues that the fragmented nature of the British automotive sector has made it more difficult for an automotive supplier to develop.
Image rights AP Image Caption car sales have had a good start for 2014.
Some people fear that foreign companies might be quick to cut and run in a recession.
In the UK car sector which has certainly not been the case.
Big companies have all invested heavily in research and development, facilities and processes throughout the recession.
They are reaping the rewards of that investment today.
The real lesson of the automotive industry is not as foreign ownership is necessarily a good thing for a sector or a company, but it certainly doesn not to be seen as a threat.
The real difference is not between foreign and domestic ownership, but between companies that are willing to invest for the long term and those who want the short-term gain.
In the automotive industry, large manufacturers could all belong abroad, but they have shown a commitment to British industry.
You can see the film on Newsnight Duncan Thursday, May 15 to 22 30 on BBC Two or later the BBC iPlayer.
Foreignowned automotive industry in the UK offers economic lesson BBC News, industry offers economic.