Best half-year for UK car manufacturing since 2008 as productivity accelerates

2:00 am, July 23, 2015

BRITISH car manufacturing delivered a strong performance in June, with volumes up 5.4 per cent over the same month last year, according to new figures from the Society of Motor Manufacturers and Traders (SMMT).

A total of 143,759 cars were built in the month, with production for export (up nine per cent) outperforming that for the domestic market (down 7.1 per cent) – a reversal of the trend seen in previous months.

June’s rise led the sector to its best half-year output since 2008. In total, 793,642 cars rolled off UK production lines between January and June, up 0.3 per cent on the same period last year, equating to more than three every minute.

The news comes amid further evidence that the sector is leading the way on productivity. New figures reveal the sector achieved £100,000 in value added per employee in 2014 compared with £74,000 in 2010 – a 35 per cent increase. The performance is particularly impressive when set against the £50,000 average per employee for the UK economy as a whole.

With production volumes up more than 50 per cent since 2009 and significant investments still to be realised – a raft of brand new models are set to hit production lines in the coming months – the UK car industry is growing on a global scale.

While the sector is enjoying robust demand in the domestic market, it is not immune to external influences. With economic and political instability in some global markets, it is essential the UK retains its competitive leadership, attracting investment to stimulate innovation, productivity and employment, says the SMMT.

Mike Hawes

Mike Hawes, the SMMT chief executive, said: ‘Today’s figures are testament to the ever-increasing demand for the diverse, high-quality range of cars we make in the UK. The sector is ahead of the game on productivity, with investment in efficient, hi-tech manufacturing processes and a highly-skilled workforce resulting in huge gains over the past decade.

‘This success has been built on significant industry investment and has also relied on a positive relationship with government, essential if the industry is to maintain its international competitiveness.’