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UK car manufacturing falls by nearly 10 per cent

UK car manufacturing falls by nearly 10 per cent

UK CAR manufacturing fell by nearly 10 per cent last month with 15,255 fewer units produced compared with the same month a year ago, according to data published today by the Society of Motor Manufacturers and Traders.

Market turbulence at home and overseas, uncertainty over Brexit and model changes all played a part in the 9.8 per cent decline in October, it said.

Production for the home market fell by 12.1 per cent – the fifth consecutive month of decline – with 24,246 cars destined for UK showrooms. Meanwhile, overseas demand also fell – down by 9.3 per cent last month.

Source: SMMT

However, exports continued to account for the lion’s share of output, taking 82.7 per cent of all cars produced. Year-to-date output remains down, falling by 6.9 per cent, with some 1.3 million units produced in the first 10 months.

SMMT chief executive Mike Hawes said: ‘The fifth consecutive month of decline for UK car manufacturing is undoubtedly concerning, and while a number of factors have been at play, there is no doubt that business and consumer uncertainty is having a significant impact.

‘With eight in 10 British-built cars destined for overseas markets, the majority to the EU, the sector’s dependence on exports cannot be downplayed.

‘Europe is our largest trading partner, and securing the right Brexit agreement which allows free and frictionless trade is vital for the future health of our industry.’

Commenting on the figures, Alex Buttle, director of car buying comparison website Motorway.co.uk, said: ‘With the odds shortening all the time on a no-deal Brexit, UK car manufacturing is staring into the abyss.

‘The problem is that right now no one really knows what the consequences will be if we leave the EU with no deal. There is a torrent of negative news regarding it being the end of the world for the car industry and that in itself is crushing consumer confidence.

‘The last thing consumers are going to do when there is so much uncertainty swirling around is buy large-ticket items like new cars.

‘Consumer confidence needs a boost from somewhere to get domestic demand back on track, or our over-reliance on the export market leaves the EU holding all the trump cards.

‘The current withdrawal agreement that’s on the table doesn’t give UK car manufacturers the reassurances they need, or any kind of optimism that something will change for the better with a new EU trading agreement. The current situation is the worst of all worlds.

‘These are perilous times for auto manufacturing and no one is quite sure what anyone’s next move is going to be. That is going to weigh heavily on production figures.

‘It’s likely the pain is only going to get worse from here and output numbers are likely to keep falling until we have a clear picture what deal, or no deal, we will be leaving the EU with next year.’

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