How will a car they call 'The Temu Range Rover' affect the politics of the United Kingdom under Andy Burnham's rule? The answer is: more than you might expect.
This weekend sees the start of the Labour Party conference, Mr Burnham’s first as party leader and Prime Minster. His leader's speech on Tuesday afternoon will do much to define the type of government he wants to run in the time remaining to it. It is also the latest instalment in the re-launch of that government, and the party that leads it.
His overall aim is to fix an image in the minds of the British voters - a combination of ideas, personalities and feelings - that will clearly define Labour in relation to its main challenger, Nigel Farage’s Reform UK.
His big constraints are the 'Three Es' - the Economy, Europe and the Election.
Of course every politician is thinking of the next election. In theory the next British election doesn’t have to be held until 15 August 2029. In practice, leaving it that late means the Prime Minster is the hostage of events. Most prefer a time of their own choosing (and certainly not the middle of the summer holidays).
Boris Johnson chose to go to the country within three months of ousting Theresa May, to seek his own mandate from the people to push through a hard form of Brexit, and to secure a full five years to implement it. He won his "stonking great majority" in the autumn of 2019, and his hard Brexit, and the Tories got four and a half years to the next election - but it took three prime ministers to get there.
Mr Johnson became Prime Minister on 24 July 2019, Mr Burnham became Prime Minister on 20 July 2026. Boris called the election in late October 2019: Is Andy tempted?
The logic of using the leader's speech to call a snap election goes like this: Mr Burnham and his party is enjoying a bounce in the polls. He hasn’t been in the job long enough to have offended or upset anyone, and the public hasn’t got a fixed idea of who he is (unlike Keir Starmer, who couldn’t shake the public’s negative perception). The conservatives are weak under a new leader who is focused on internal recovery, and Reform is too new in the game to present a credible alternative government right now. It has also been rocked by a serious party funding scandal that will dog it over the next year at least.
But thanks to its two crypto-billionaire donors, Reform is stuffed with cash - far more than all the other parties put together. If it spends wisely over the next couple of years it could be in formidable shape by late 2028 or spring 2029.
But between now and then it faces severe growing pains. It has eight MPs: It needs 326 to govern on its own. What on earth would the trawl nets bring up if it had to find 500-600 parliamentary candidates for a snap election in say, mid November?
Even the big established parties, with the due diligence of deep organisations and professional HQs, surf into government on a wave of new MPs that always contains a quota of miscreants whose subsequent exposure slowly whittles away the majority, dignity and respect of the government.
This competence/execution/reputation risk is greatly magnified for a 'startup' or 'insurgent' party, particularly one competing in a first past the post system that might, just might, hand them a governing majority. Only two of their existing MPs have cabinet experience.
So an early election will disadvantage Reform as an organisation. The longer it has to develop, the stronger it gets. The same for the Conservative Party, still shellshocked from the trauma of the Brexit years and the rise of Reform as serious challengers on the right. It needs time to bed in under the leadership of Kemi Badenoch, and redefine its public image. In this task it is surely helped by the defection of MPs, councillors and supporters to Reform, as it reduces the amount and bitterness of internal party divisions. A longer run in to the election suits the Tories. So it looks like there are incentives for Labour to go to the polls quickly. Though the threat to Labour from the Conservatives is not as pressing as the threat from Reform, which is very strong in the Labour heartlands.
On Friday evening Mr Burnham denied to regional TV stations that he was going for an early election, suggesting 2029 was the date. Calling an early election would be "self serving politics" - not getting on with delivering things he had promised.
And then there is the polling. The parties do their own, and guard the data closely. Helpfully Sky News published a You Gov 'mega poll' on Thursday, pitching an "in a general election today..." scenario. It found Labour would get hammered, losing 171 or so MPs. But it would still be the biggest party on 231 seats.
Reform and the Conservatives would be more or less equal on 120 and 130 each - combined they would have a few seats more than Labour, but nowhere enough to govern.
The Liberal Democrats 71 MPs would then be the decisive block, the kingmakers in any coalition deal - and they won't work with Reform. Even then the Lib-Lab coalition would be short of seats.
This poll sees a big revival for the SNP - winning 40 seats, and Plaid Cymru, going from 4 to 15. But after the events of two weeks ago surely their price of support would be new independence referendums for Scotland and Wales.
Whether the Tories would do a deal with Reform, the party that wants to eat them and replace them, is debatable. As is the idea of the Lib Dems ushering in the era of Nigel Farage in Number 10.
The other headline from the poll is a massive fall in Reform seats from last year's Mega Poll - which put Reform on 311, making it the biggest party and on track to form the next government (presumably abetted by the rump of 45 Tory MPs that poll projected).
In terms of vote shares, the Sky poll put Labour on 24%, Reform on 22% and the Conservatives on 21%, with the Lib Dems on 12%.
Maybe the safest bet is to hang on to the majority you have and see how events play out over the next two years or so. And there are certainly events at work, notably the wars in Ukraine and Iran.
Which brings us to the second E - the Economy. It's not good. The war-driven rise in oil prices is hitting the UK hard. Growth hovers around 1%. Debt/GDP hovers around 95% - and that combination of high debt, weak growth and a grim outlook, driven downwards by the wars, has led to the cost of government borrowing to shoot up.
The yield on UK ten-year bonds is now some 5.36%: the equivalent borrowing cost in Ireland is 3.64%. Debt service costs in the UK are now more than 8% of government spending, close to the amount spent on education, the number three government spending area.
During the week, the IMF called on politicians to take decisive steps to cut debt service costs across a number of high debt countries (including the USA and France). But the effects of Russia's invasion of Ukraine and the blockade of the two main export routes for oil from the Middle East means governments face competing demands for more defence spending and measures to alleviate the cost of living brought on by the oil crisis. Britain is no different in that regard.
So Chancellor of the Exchequer John Healy’s speech to the Labour conference at midday on Monday will be closely watched to see how the UK government may set about balancing this tricky situation.
Mr Healy resigned as Kier Starmer’s defence secretary during the leadership heave, ostensibly because he couldn't get enough money for defence spending rises. Now he has to provide money for his successor, Wes Streeting. As if he needed reminding, Russia formally named the UK as partnering with Ukraine in a series of drone attacks on Moscow at the start of the week, turning up the burners on UK defence spending needs.
At the same time the arrival of Halloween products in the shops tells us that winter is on the way, and with it even higher energy prices in a country that is among the most expensive places in Europe to try and heat your home. That brings pressure to do something about energy costs.
The short run option is to cut taxes, but the budget situation is dire, and the revenue loss could be compounded by raised borrowing costs - which in turn feed into the cost of all borrowing, starting with mortgages.
The ultimate solution to the economic problems is a better economy: good growth in all postcodes as the PM himself likes to say. Easier said than done, but certainly the right prescription.
So the question becomes what can the government do - and do fast - that will turn things around so the public is spared the worst this winter, and might even vote Labour in sufficient numbers at the next election? The clamour for fuel subsidies will be massive, the cash to provide them extremely constrained.
Which brings us to the third of those big Es - Europe. Ten years after Brexit, former Labour prime minister Tony Blair picked the Thursday before a Labour conference to make a major intervention on Britain’s relationship with the EU. He wants Britain to announce it intends to join what he calls a reformed EU in ten years' time. In other words, he wants Andy Burnham, an MP from a heavily Leave voting constituency in the Red Wall to announce it.
Mr Burnham campaigned against Brexit, and probably would like to be back in the EU. But as an arch realist he knows it is not the burning issue some party activists think it is. Nor is it an instant cure to the UK’s economic malaise.
There is a push by pro-EU forces inside and outside Labour to get the country to rejoin. The anaemic economy and the fact that practically nothing the Brexiters promised has come to pass (especially on immigration) have convinced more Britons that leaving the EU was a bad idea. But the polling on actually rejoining is far from convincing.
A politician focused on the near term prospects of an election will probably not want to go there - although it is a very obvious point of difference with Reform. It is probably an unwelcome intervention this conference weekend, though the EU argument is coming to British politics sooner or later. Some within Labour want that to be sooner. Like next week.
Tony Blair naturally deploys the word 'reform’ in making his case - specifically that the UK should only seek to rejoin a "reformed" EU, by which he means one that has implemented the Draghi report, toughened its borders against migrants, and removed the veto in foreign policy decisions, and is "A Europe of the Nations" (which was once the name of a political party in the European Parliament, founded by French Gaullists: Fianna Fáil was in the group, before shifting to the Liberals/Renew group).
Mr Blair writes: "Europe now faces another inflection point. In a world increasingly defined by great-power competition, its organising principle must evolve once again. The defining question is how Europe builds and projects power.
"Modern power extends far beyond traditional military strength. It depends on the ability to generate economic growth, develop and deploy frontier technologies, mobilise capital, secure affordable and resilient energy, and translate innovation into strategic advantage.
"These capabilities increasingly determine who sets technological standards, where investment flows, who controls critical supply chains and which countries can respond to crises on their own terms. States that possess these capabilities are better able to generate prosperity, protect their security and shape the international environment in their favour. Those that do not are forced to adapt to decisions made elsewhere.
"The United States and China have adapted to this reality. Both combine continental-scale markets with coordinated industrial strategies, deep capital markets, technological leadership and growing military capability. Europe possesses many of the necessary underlying strengths... However, these strengths remain fragmented across multiple states and institutions, making strategic coordination far more difficult.
"The EU remains the principal mechanism through which Europe can organise and translate these capabilities into power. But building a continent capable of competing with today’s great powers will require reform of the EU and a broader conception of European cooperation and coordination that extends beyond the EU’s current membership.
"Britain should play a leading role in shaping a more powerful Europe. The necessary reforms have already been identified - not least in Mario Draghi’s report on EU competitiveness - but implementing them remains the challenge. For Britain to be part of that effort, it must show political commitment to Europe. This can be achieved by setting a clear, public objective to rejoin the EU within a decade - subject to internal EU reform. This objective should be a cornerstone of the UK government’s upcoming ten-year plan."
It's big, bold, ambitious stuff. And it relies on an era-defining political ambition in a Britain still bitterly divided by Brexit, and a transformative shift in the way the EU and its member states actually operate - one which has to precede the consummation of this new political union. Don’t hold your breath.
In the meantime the 'Temu Range Rover' may be the rock on which such hopes perish in the short term. This is the nickname of the Jaecoo 7, a Chinese made hybrid-engined SUV that sells for around £30,000 - undercutting most competitors. If the name is not familiar to you, it's because it's the first car from a new brand. But it's gone from zero to being Britain's third bestselling car in two years. It's part of a wave of Chinese cars that have surged into the UK in the past few years. Chinese made cars now have a bigger market share than Japanese cars in the UK. Some are looking at manufacturing sites in the UK, particularly for electric vehicles.
The brand is not on sale in Ireland. It may not be for some time, and the price is likely to be a lot higher - not just for the usual reasons of VRT, but because battery cars from China are subject to extra tariffs of up to 45% - part of an EU measure to protect European industries from subsidised and low-cost Chinese makers that have developed huge advantages of scale. Using Britain as a manufacturing base may be a way around that - especially if it develops a new arrangement with the EU that opens the benefits of the single market to the British (and any EU subsidies that come with that). Naturally the EU sees this happening, and is trying to head off the risk to its own manufacturing base with a new 'Made in Europe' policy.
Anything from the EU is OK, as is anything the EU designates as 'European' from neighbouring countries. But right now that does not include cars made in Britain by non-EU companies. The French are blamed in the UK (as usual), but the German carmakers - remember them? - are also under huge pressure from Chinese automakers taking market share worldwide. A protected European market may be the last redoubt of the very industry that was supposed to shape Brexit in favour of the Brexiteers back in the day.
Brussels has seen how Chinese manufacturers - especially car makers - rapidly set up in Mexico to sell into the US market, prompting the tariff war under US President Donald Trump. Chinese EVs are now banned in the US, to give domestic makers like Ford and GM a chance to play catch up - or just stick with petrol-driven internal combustion engines (drill baby drill).
A more protectionist EU is not likely to find much favour with Tony Blair or Conservative fellow travellers. But fear of a 'China Shock 2.0' doing to European industry what the first China shock did to US manufacturing is very real and is driving policy in Brussels.
It has also become an acute worry for Andy Burnham’s government. So far the UK has taken a very open attitude to Chinese car brands, which are flooding the market with new brands (or an old brand in the case of MG, the one time British sports carmaker, whose name was bought out of receivership some 15 years ago by a Chinese company that is now gaining share selling Battery SUVs with the MG badge on them).
The surge of cheap EVs helps Britain to transition to a low carbon economy, speeding up the process of converting the car fleet from combustion to battery. With little by way of a domestic car industry left to worry about, the arrival of Chinese factories could provide some much needed industrial jobs and supply chain growth. But not if the EU drops a massive tariff on it by not designating British built cars as "made in Europe" for the purposes of access to the single market.
For someone who wants to re-industrialise Britain, and hit climate change targets, and cut prices for consumers, and get closer to the EU, the case of the Temu Range Rover is a really tricky one for Andy Burnham.
After last week's meeting with Mr Burnham at Number 10 North, the Taoiseach Micheál Martin said we should not underestimate the amount of internal work the EU has to do on the issue of 'Made in Europe', making sure it does not undermine existing trade deals with the UK, Canada and Japan.
Ireland too has a dog in this fight because of its role in global supply chains, notably for US electronics companies that source components in China, and the large lumps of corporation tax such global supply chain activity drops in Ireland's Exchequer account.
With lots of national interests at stake, 'Made in Europe', whilst sounding appealing, has the prospect of becoming a pretty nasty row between member states, one of those "events, dear boy" things that happens at exactly the wrong time for Andy Burnham and his mission to relaunch the UK and the Labour Party’s role in leading it.
Meanwhile, to Liverpool and the Labour Party conference.
