UK car production drops 18.2%

by Jonathan Adams
UK car production

Stronger demand in Japan and China went some way to offsetting declines elsewhere, the SMMT notes

New figures from the Society of Motor Manufacturers and Traders (SMMT) show that UK car production dropped 18.2% year on year in October.

Over the course of the month, 110,179 new cars left UK factories, compared with 134,669 in October 2019. The 24,490-unit shortfall is attributed by the trade body to domestic and overseas lockdowns subduing demand.

A 19.1% drop in cars built for export amounted to a loss of 21,569 units, with shipments to the US falling 26% and the European Union 25.7%, while 2921 fewer cars were produced for the domestic market.

However, the SMMT notes that stronger demand in Japan and China – 57.1% and 9.7% boosts respectively – went some way to offsetting declines elsewhere.

For the year to date, according to SMMT data, UK car production is now down 33.8% compared with 2019, with a loss of 379,308 units amounting to a £10.4 billion shortfall.

In recent months, the SMMT has ramped up its efforts to convince the government of the importance of a secure trade deal with the EU after Brexit. With no deal in place, it says, the UK car industry could lose as much as £55.4bn in revenue over the next five years.

Even with a so-called ‘bare-bones’ trade deal agreed, the SMMT said, the cost to industry would be some £14.1bn.

Just over a month remains until the UK is scheduled to officially leave the EU, but final trading terms have yet to be agreed by both parties.

SMMT chief executive Mike Hawes said: These figures are yet more bad news for an industry battered by Covid, Brexit and, now, the unprecedented challenge of a complete shift to electrified vehicles in under a decade.

While the sector has demonstrated its resilience, we need the right conditions to remain competitive both as a manufacturing nation and a progressive market. Yesterday’s Spending Review recognised the need to invest in a green industrial revolution, but this must be at globally competitive levels and equal to the scale of ambition to keep this sector match fit, he said.

Hawes said, above all, we must have a Brexit deal, one with zero tariffs, zero quotas and rules of origin that benefit existing products and the next generation of zero-emission cars, as well as a phase-in period that allows this transition to be ‘made in Britain’.

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