Flights and heights

0:00BBC Sounds. Music, radio, podcasts. Wake up to money from BBC 5 Live. Hello, welcome. It is Wake Up To Money twice in the space of two weeks. Andy Burnham saying the air traffic control problems that have caused widespread disruption again must be fully investigated. Captain made the announcement that there was going to be like a three hour delay before we'd be able to take off. We'll bring you the very latest on that from planes to automobiles. Why the UK car industry is calling for British companies to be included in EU product rules. That's something that might also come up for the Prime Minister on his trips to New York today when he speaks with those at the European Commission, perhaps.

0:44And we'll also be taking a dive into the scaffolding industry, which is facing a huge shortage of workers, despite the PM's pledge to get Britain building. It's massively underestimated and it can be so frustrating. For those of us who work in the industry, we know what a great career it can be. Now, can the Prime Minister get his oar into this one? Surely not. Are you a fan of ABBA Voyage? We're going to hear more from a company aiming to grow digital gigs after securing a new£15 million investment. Wake Up To Money with Sean Farrington. Good morning to you. Wake Up To Money on BBC5 Live. Thank you for being with us on this Tuesday morning, the 22nd of September.

1:24It's just after five o 'clock. Lots to discuss the future of the UK car industry. We know so many of you either live in an area that has over the years had been hugely influenced by car manufacturing, the supply chains around it. You may work for a business right now. Interesting where the next car purchase you make is going to be from, how you're making it, where that car is built. We've had lots of that chat lately. There's been talk in recent days, which we'll get into on the show as well today, about should the car industry be evolving, those manufacturers in the UK be evolving towards the defence sector as well.

2:04So plenty going on there and the future of the EU's approach to how it makes its cars and the rules about where cars can come from and all the parts and what that might mean for those that are made in the UK as well. So that all coming up, plus digital gigs. Joanna Jensen is with us this morning who founded and then sold the skincare brand. Child's Farm, now an angel investor herself, Joanna. Good to speak to you again. How are you? I am very wide awake, Sean. Good. That's what I am. And you are not a hologram, Joanna. We can tell that already. Would you be up for one of these gigs where, you know, the technology these days, I noticed the word hologram isn't really being used, but it's how we might equate to somebody not really being up on stage, but blimey, it looks like they are.

2:53There may be somebody long in the past, long deceased, who has been able to be able to put on a concert once again for everybody. Fancy a bit of that for nostalgia? Well, we went to see ABBA and we absolutely loved it. It was brilliant. And, you know, we all dressed up. I'm not many other people dressed up, but that's fine. Always good. And it was just what a performance. You just feel like you're part of the whole show and you feel like you're 40 years younger than you really are. So this was the ABBA Voyage. Voyage. I did wonder when I saw that word, I thought, am I being stitched up here? Is it Voyage?

3:33You don't want to gamble that way, do you? You don't want to say Voyage when it's Voyage. But I think if you say Voyage and it's Voyage, you get away with it. Makes its hand glam, doesn't it? It does. It does. And it sounds like you glammed up for that event as well. It was a hoot. I'll be interested in your thoughts as we delve into that a little bit later. We've got the person running that business who's raised that almost 15 million pounds a little bit later. So clearly there's a lot of interest there. I'm going to say a very good morning as well to Sunaina Sinha-Haldea, who is the Global Head of Private Capital Advisory for Raymond Jones.

4:05Sunaina, good morning. Good morning. How are you today? I'm OK. Thank you, Sunaina. There's a lot for us to get to. When you get a summit like is going on in New York at the moment, a UN summit, and there's leaders all around the world gathering for reasons that the UN will be laying out, but actually they have their own reasons for the conversations between themselves. These can be days where things sort of develop, policies change a little bit. UK talking to the US, Andy Burnham meeting Donald Trump. Andy Burnham having a chat with the head of the European Commission about the car industry. There's important times, these moments.

4:43Indeed. There are weeks in the year that can really move the needle. This is one of them because there are so many important sideline discussions to the UN General Assembly. Of course, our Prime Minister meeting, Mr. President Trump for the first time, but also the US-China summit on the sidelines this week. Also things that can really move the business environment and, of course, the geopolitical environment for all of us. Yeah, wouldn't you just have a look at Andy Burnham and what he says he's going to be talking about in his speech at that UN General Assembly, talking about closer international cooperation on AI, lasting peace in Ukraine, renewed efforts to bring the end of conflict in the Middle East and also looking at many other things to do with trade as well over the course of the next couple of days.

5:32So let's come back to the UK for a moment before we delve into some of those issues that may be discussed. I mean, who knows? This may be coming up. They've had the problems in the United States with the flights and cancellations in the last day or so as well. But here we are again, here in the UK, airlines criticising the UK's air traffic control system after a second technical problem in two weeks caused major disruption to UK flights. I was getting a flight from Edinburgh. everything was on track and then they got us on the plane and the captain made the announcement that there was going to be like a three hour delay before we'd be able to take off.

6:07I thought well maybe my flight is delayed, it took one hour then it took two hours and so I went to the gate, it's cancelled you have to get another flight. I got a text message like two hours before my flight that the flight's just been cancelled and that was it, there was just no further information after that. So it sounds like the same all over again, not quite on the same scale as two weeks ago it seems but there's a few passengers affected by yesterday's incident. EasyJet said it once again calls into question the resilience of the whole air traffic control service. WhizAir saying there'd been a national confidence crisis in NATS, National Air Traffic Services, which runs the air traffic.

6:44Andy Burnham has said those problems have caused widespread disruption for the second time in two weeks. Clearly very serious, need to be investigated. Simon Calder with us, travel correspondent with The Telegraph. Simon, good morning to you. Good morning, Sean. Exactly as you say, this was an order of magnitude less bad than the events two weeks ago. Today, we've had about 200 flights cancelled altogether compared with about 2 ,000. But my goodness, the effects, there's going to be people listening as they are driving home from airports such as Edinburgh, Glasgow, Belfast International, having got in a couple of hours late on holiday flights on Jet2, on Ryanair, on AZJet from various parts of the world, as well as lots of people waking up where they didn't expect to be because their flights were cancelled yesterday.

7:38And the airline accountants are going to be furious once again, because this lands with them. They will have lost several million pounds. That's made up of lost revenue when people just said, I'm not going to go on this trip because it's either extremely late or cancelled. I'll have my money back, please. And probably more significant, the care costs where airlines have to pay for hotels and alternative flights and meals. So an absolute mess. But I'll tell you what, you mentioned the US problems. They were absolutely awful last night. Let me ask you about those in a minute, Simon, because I'm interested in those.

8:15But I just wonder, with these issues that people saw again yesterday, what happened a couple of weeks ago, and as you've described, it was a bigger mess a couple of weeks ago, but the ripple effect did take a fair few days for everything to calm down. What's going to be the situation today? Should people be on the lookout for potential cancellations again today or changes in the way that their trip was going to go ahead? It's not so bad at all. I'm seeing the odd delay, for instance, from Bristol to Glasgow. You'll get a text message saying your flight's going to be going an hour late. That will be because the plane or the pilots and cabin crew simply have to have their minimum rest requirements or the plane's been in the wrong place and they're flying it back.

9:05So today should be OK with a few delays, but it did cause massive problems. actually quite a lot of them at Heathrow, even though that wasn't in the area covered, which was basically everything from Manchester northwards in the UK. And that's simply that BA has so many connections from Manchester, Newcastle, Edinburgh, Glasgow, Inverness, Aberdeen, Belfast City, that loads of people just miss connections. So there will be people who are trying to repair their journeys today because they missed their cancellations yesterday. They missed their flights yesterday. Oh, dear, that's a Freudian slip.

9:42Yes, as long as you're on one at some point, people will be hoping that's okay. Simon, you just described there what's happening at Heathrow, even though that wasn't in the primary part of where the issue was with Nats yesterday. So that is another reminder of the interconnected nature of all of this and also how little wriggle room there is for a mistake. What do you think, Simon? We've talked to you plenty of times over the years. You will have closely followed those departure and arrival boards more than anybody else. When you see that air traffic control is causing these issues, does there need to be an urgent fundamental review?

10:26That's such a good question, Sean. And the answer is, well, kind of, but it's so difficult because aviation is, particularly in the UK, which has the most overstretched aviation system in the world. It has the busiest skies in the world over the London area. It's like a very high speed, three dimensional game of chess. And almost all of the time, the brilliant men and women who are air traffic controllers get away with it. And everything needs to work right for aviation to function as we want it to in the UK with loads of flights, with reasonable fares. And you could say, OK, look, what we know for a fact is that exactly as you say, as soon as something goes wrong, then everything unravels very quickly.

11:14OK, let's reduce the number of flights and then things won't be so bad. Now, that is one strategy. But I think there would be howls of protests, starting with the passengers saying, no, I want my full choice of flights and my low fares. And the airlines say that we've invested in all these aircraft and so on. So just get the system to work. But unfortunately, aviation is a confidence business. Massengers need reassurance they're going to be able to get to their family event, their business meeting, their holiday resort. And unfortunately, this second failure in less than a fortnight is going to undermine that confidence.

11:49So some questions over system issues here. Over in the US, they've had their own air traffic control problems, as you mentioned. But this one, a bit of a bizarre issue they've got here that has caused huge delays. Yes, this was a circuit that the air traffic control in the whole of the New York area is largely controlled by the Terminal Radar Approach Control Centre in Philadelphia. And as you can imagine, there's a big bit of wire that goes from Philadelphia to New York JFK to Newark to LaGuardia airports in the New York area. Now, that circuit failed. Of course, there's huge amounts of resilience built in.

12:31there's a backup line unfortunately pretty much at exactly the same time um a construction crew who were working on a rail project uh in new jersey actually cut through the backup cable um and that was going to take hours to fix they basically keep all the planes on the ground you have things like british airways and uh going from heathrow to new york jfk diverting to boston The UN General Assembly is going on there. You know, it's kicking off today. Oh, sure. Yes. I mean, it's an absolute mess. And it just shows that stuff goes wrong with aviation in many different ways that people hadn't thought of when they investigated.

13:13And, you know, lots of calls, of course, this morning for Martin Rolf, the boss of NATS, National Air Traffic Service, to go. But ultimately, as we heard in that quite frank report that came out last Friday, things are going to go wrong. And all we can be all we can really do is be better at switching the thing off and switching it back on again, which doesn't sound very 21st century. But I think that is probably the reality. Get Simon Calder on that by the switch for the National Air Traffic Control System. Simon, thank you. Simon Holder, travel correspondent with The Telegraph, Joanna Jensen with us.

13:52Founded and sold skincare brand, Charles Farm, angel investor. Joanna, when you have the second... So, I mean, put yourself in the position of that Martin Rolfe, who nobody had heard of before a couple of weeks ago. He's head of that NATS air traffic control set up. And you had to defend his position a couple of weeks ago. Two weeks later, a much smaller issue, but an issue all the same. How do you manage that? This is the system, isn't it? It cost an absolute fortune. I mean, the poor, I mean, I do feel sorry for him. You know that air traffic controllers have got the highest suicide rate of any job that there is because it is phenomenally stressful.

14:33You're looking after people's lives in such large quantities. I mean, it's a mess, isn't it? I seem to recall the first one they did was because there were two elements of the system that had the same code name. And so it couldn't work its way through. I think whoever delivered this system should be working 24-7 on it and going through their protocols. And nothing in this world is ever perfect. But this twice in two weeks, it tells me that somebody that whoever supplied that should be working around the clock and just going through all their testing again and again and again and have a shadow system and working through it.

15:16because Nets is going to end up paying these air car carriers a fortune. In penalties, it must be because nobody can run a business like this. So I wonder whether his position really has any form of security to it. 85058, if you've been caught up at all in the problems a couple of weeks ago, how did that resolve itself? or if you are dealing with the reaction of yesterday's issues with air traffic control, let us know. 85058. Good morning to you. It's Wake Up To Money on BBC 5 Live. We're talking about air traffic control and Joanna and I are talking about the job of doing it and the stresses that can arise with it as well.

16:03If you've been affected by any of the issues raised that we were talking about there, You can find a list of organisations offering help at bbc.co.uk forward slash action line. Thank you very much for your messages that we've had in so far. There's a big summit going on in New York today. It's a UN General Assembly summit, but plenty of individual conversations and speeches that will be getting lots of attention as well. So Andy Burnham says he expects to find common ground with Donald Trump in their first meeting. Joanna Jensen. Joanna, when we talk about common ground with the United States, what are the priorities of a prime minister right now when talking to Donald Trump?

16:52Well, I love trying to get common ground with Trump. I mean, good luck with that. I think the priorities have got to be trade. Absolutely, because we are so dependent on America for our exports. And the reason, hoo-ha, with all these changing tariffs, we've got to have continuity on this. It's very hard for any business who's exporting to the US to really try and A, manage their inventory when it's going to be fluctuating because of cost, but B, manage their costs. You can't have the same margin that you do if suddenly the cost of your goods in your principal market goes up by 25%. So if wearing my SME small to medium sized enterprise hat here, I hope that Andy Burnham goes there respecting these businesses, which make up 70 % of the British economy, goes there representing them and saying, right, please stop messing with them.

17:52So, Sunaina Sinahaldea from Raymond James, Investor, what do you think is going to be the key thing for leaders at this summit? Because when I just mentioned a few things that were going to be in Andy Burnham's speech earlier, I was thinking, blimey, all of these could have dominated a summit in itself in the past. And is there an issue if there's too many of these things, that there isn't a bold statement and a coming together and a common ground found amongst leaders on a big issue? Indeed. I think the key thing we're looking for here amongst world leaders, but especially with our leader and President Trump, is the setting of the tone of what the relationship will be like.

18:38With Prime Minister Starmer, former Prime Minister, that it deteriorated towards the end such that the UK's reputational credibility was at stake and nothing moved forward. None of the agenda topics moved forward because of that stalemate. So we're all going to be watching to see if this quote unquote common ground, if there is at least somewhat of a pragmatic approach on a few of them, you're not going to get bites on the entire list of agenda items that we have as the United Kingdom, nor is any other country. But I think you're reading to see what the tone of the potential partnership might look like going forward, whether it'll be a constructive one with the Trump administration or not.

19:20Now, one of the things that might not have been in the bullet points I mentioned of Andy Burnham's speech to everybody at the UN, but when he has a conversation with the European Commission President Ursula von der Leyen, it looks like he's going to be trying to broker at a breakthrough on a reset of those UK-EU relations and particularly some pertinent questions at the moment for the UK car industry. So the EU has proposed a made-in-Europe regulation system that would have, well, what we're being told by the car industry in the UK, a devastating impact on UK manufacturers. So under the new rules, it's expected vehicles would have to meet made-in-Europe requirements to qualify for some financial support.

20:04Mike Hawes is Chief executive of the SMMT, the body that represents the car industry here in the UK. Mike, good morning. Morning, Sean. Just explain, Mike, maybe even if there's an example of a car we make somewhere in the UK, what would be the consequences of these made-in-Europe rules if and when they all go through as they are at the moment? Yeah, well, what the European Commission has proposed is, and this is, you know, to try and face down the threat of increased global competition, you know, especially coming from China, was that to be eligible for support across the EU, you know, that can be in terms of public procurement, it can be in terms of corporate fleet support, it can be in support of, you know, additional incentives for small cars.

20:54Now, collectively, that represents something like 70 % of the European new car market. And what the Made in Europe proposal say is that to be eligible to receive that support, those incentives, the vehicle must be assembled in the EU. So at a stroke, that would make the majority of vehicles that we sell into the EU uncompetitive because some of these incentives can be quite generous, especially around corporate fleets. So all of a sudden, you know, not dissimilar to an additional tariff, you're facing additional costs just to be on the same level playing field as EU producers. So why would the EU be up for, open-minded about having some exception to the rule that would make things a little easier for the UK car market?

21:48Because the UK industry is totally integrated within the European car industry. We saw that during the Brexit negotiations. we had to make sure we had a deal because if you damage the UK industry, in effect, you would be damaging the European industry as well. So we've commissioned an economic impact assessment by Oxford Economics, and it shows that basically what is at risk is something like£24 billion of economic activity. Now, that is based on what we basically spend in Europe in terms of parts, components, supply chain and so forth. And what is also the induced activity? In other words, by doing so, you know, those European companies, you know, they employ, first of all, there's about 250 ,000 jobs that depend on this relationship in Europe.

22:39But also the additional spend in terms of logistics, in terms of business services, financial services, give you this huge amount of money. So if you're going to say that, you know, we're not going to allow or basically put up these barriers, is not only would you damage and potentially fatally undermine the British industry, you'd be assuring the undermining the destruction of your own industry. It makes no sense. Well, when you say undermining the destruction of your own industry, isn't part of the point of this that the European Union will want is that whatever the bumps in the road there might be in the short term, actually in the longer term, this will solidify Europe making its own cars.

23:21and protect more jobs in the longer run for Europe. It doesn't need to have UK jobs as higher priority within the EU. It has EU jobs, does it? Well, that would assume that any jobs lost here would immediately transfer to the EU, and that's just not what's happening across the supply chain at the moment. The pressure on cost, because of the competitive challenge of China and elsewhere, is meaning that the supply chain is being undermined, and that those jobs are going elsewhere. You know, if you go back 30, 40 years, the jobs kind of move from Western Europe to Eastern Europe. They're now going further afield.

24:01They're going into Asia. They're going to a certain extent into North Africa. So basically, it wouldn't be a like-for-like swap. It would be, you know, we just compound the reduction, the pressure that's on the industry and which is why we've been talking to the European Supply Chain Association and the European Association of Vehicle Manufacturers, both of which want the UK, for this purposes, included as part of these Made in Europe proposals because they can see the damage that will entail. Mike, I'm sure you've been very aware of this open letter that was written a couple of days ago by many manufacturers in the car industry, particularly those that are suppliers to Jaguar Land Rover, for example.

24:48You know, we've spoken to some of these with various JLR issues and job cuts in recent weeks about what's going on in the car industry. And many have banded together, written a letter to the government about helping car manufacturers move into aerospace and defence, warning that large scale car production in the UK faces long term decline. What's your reaction to that? Well, it's something we've been engaged with, you know, for a number of months, in fact, over a year. I mean, everyone was waiting for the publication of the defence investment plan. Because, you know, the automotive industry is under severe pressure.

25:29Now, first and foremost, we want to see the UK automotive industry grow. That's the most straightforward thing. But, you know, certainly for the supply chain, which has been, you know, had a near-death experience coming out of COVID, cyber attacks, semiconductor shortages, the volumes of UK production have really fallen. So it is absolutely right. You look at other opportunities. Defence is one of them. We've run a number of webinars. We've run conferences. I've had meetings with ministers about this. We've actually got a meeting today which has got this on the table because there are opportunities, but they're not necessarily straightforward because remember, the automotive business tends to be a volume business.

26:08You know, if you're a particular plant, maybe producing 250 ,000 cars or something. For defence, it's more... We know that's changed, haven't we? With electric cars, the whole supply chain has been shaken up in itself. Absolutely. It's under severe pressure. And first and foremost, we want to get that industry back. However, these are often transferable skills. There is a capability there to sell into the defence industry. The defence industry wants to increase its local spend because, you know, it's all about resilience. And so you want to make sure we've got a UK manufacturing sector that can support the needs of the defence industry as well as the automotive industry.

26:50There are certain hoops to jump through, you know, obviously in terms of security requirements, but also remember often defence contracts, you know, rather whereas automotive is large scale, you know, three or four years, defence tends to be much lower volumes, but, you know, much longer period of time. So again, you have to make sure your business is fit for that sort of type of business. It's something that we're trying to encourage. We've spoken to government. Government wants to do this as well. So it's about with the publication of the Defence Investment Plan, can we have the flexibility to make the right products that the defence industry needs as much as the automotive industry?

27:25So very much a work in progress, but tremendous opportunities. Mike, thank you for your time this morning. Mike Hawes, their chief executive of the body that represents the car industry in the UK, the SMMT. Joanna, when an industry like that, I mean, it's quite stark when you see the suppliers to that car industry say, you know, this is in long term decline. But they want to pivot to an industry which they feel, and we hear, is going to be going through a period now of increased investment, defence and aerospace. space how how tricky is that for you know as a decision for UK manufacturing to have to think do we not just diversify but does this mean we're stepping away from something we've done for so long well I think that's the name of the game now I'm afraid you you can't same as same as cannot continue for much longer can I just say how elegant Mike was on this and I wish him every success with the DBT on his conversations.

28:29But what concerns me about the switch to defence, which I would just bend your ear about, Mike, is that by a Series C raise, so this is a raise that a business will have as it grows its business and it's looking for additional serious investment for growth. For the defence industry, by that stage in its growth, 100 % in the UK of defence industries are owned by overseas investors. Now, this is really, really important. If the government is going to get behind pivoting to defence, they have to have the money in the coffers to ensure that these businesses, once created, once scaled, remain in the UK.