Eleventh consecutive month of growth for UK car makers

Eleventh consecutive month of growth for UK car makers

UK CAR makers reported their 11th consecutive month of growth in June, according to figures released today by the Society of Motor Manufacturers and Traders (SMMT).

Production grew 10.4 per cent to 158,641 units – the highest level for the month since 1998, when volumes reached 172,232.

The performance closes the industry’s best first half for 16 years, with 897,157 cars rolling off production lines so far in 2016 – up 13 per cent on the same period last year as billions of pounds of investment in new models came to fruition. Exports drove volumes, with year-to-date demand up 14.9 per cent to 695,139 units, while production for the domestic market also grew 7.1 per cent.

UK Automotive is export-led, with 77.8 per cent of cars built in the UK destined for more than 100 overseas markets, but the majority of which are headed for the rest of the EU. The sector is part of a complex, highly-integrated European and global supply chain, and depends on significant cross-border trade in components.

While local content of UK-built cars is growing, 59 per cent of vehicle components are imported, predominantly from the continent.

Mike Hawes, chief executive of the SMMT, said: ‘UK Automotive is globally competitive with overseas demand for British-made products increasing, not least in Europe which is by far our largest market.

‘The latest increase in production output, however, is the result of investment decisions made over a number of years, well before the referendum was even a prospect.

‘These decisions were based on many factors but, primarily, on tariff-free access to the single market, economic stability and record levels of productivity from a highly skilled workforce. To ensure the sector’s continued growth, and with it the thousands of jobs it supports, these must be priorities in future negotiations.’

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