Car makers facing ‘very tough’ conditions says SMMT as June’s production figures revealed to be lowest since 1953 bar last year

  • UK factories turned out just 69,097 cars in June
  • Almost a third of staff at some automotive firms are self-isolating, according to trade body
  • SMMT warns that the industry is ‘still in the eye of the storm’

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Nearly a third of workers in some automotive firms are self-isolating, adding to the ‘very tough’ conditions facing the industry, the SMMT said today (Jul 29).

The industry body made the stark declaration as it revealed that UK factories built just 69,097 cars last month – the worst June total since 1953 apart from Covid-affected June last year.

Production was hit by a double whammy of workers having to self-isolate, which caused staff shortages, coupled with the worldwide semiconductor shortage.

The industry has faced a ‘turbulent’ six months as a result of the pandemic, new trading rules with Europe as well as supply issues, it said.

A total of 498,923 cars rolled off production lines in the first six months of 2021 – down by 38 per cent on the five-year average – which was a loss of 311,160 cars worth more than £8.5bn, said the SMMT.

Chief executive Mike Hawes said some businesses that supplied car manufacturers were suffering from a 30 per cent shortage of staff.

Along with other industry groups, the SMMT wants the government to bring forward the August 16 date for letting fully vaccinated and tested people carry on working rather than self-isolating.

More than four in five cars built in the UK so far this year went overseas, with just over half to the EU, followed by the United States (18.8 per cent), China (7.8 per cent), Japan (1.9 per cent) and Australia (1.8 per cent).

Battery-electric, plug-in hybrid and hybrid-electric vehicles made up nearly one in four of all cars built.

Hawes said: ‘While the UK automotive industry continues to suffer the effects of the global pandemic, with first-half-year production down significantly and a tough few months looming, the sector has the capability to recover.

‘The latest investments into new models and battery production show a bright future is within reach, yet the industry still faces headwinds, most notably from global semiconductor shortages and staff absenteeism as a result of staff being ‘‘pinged’’.

‘Businesses have ensured their facilities are Covid-secure but urgent action is needed, such as bringing forward the 16 August target date for exempting fully vaccinated adults from self-isolation and introducing a ‘‘test to release‘‘ scheme to support those employees not yet fully vaccinated.’

Hawes said recovery from the pandemic’s impact would be slow, with car production down billions of pounds on where the industry should be.

He added: ‘We are still in the eye of the storm.’

The impending closure of Honda’s factory in Swindon tomorrow (Jul 30) was ‘deeply disappointing’ and would cost the industry a significant amount of capacity, said Hawes.

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But he also pointed to more than £600m of investment announced in the first half of the year as evidence that the industry was still ‘fundamentally strong’.

Reacting to the news, Jim Holder, editorial director of What Car?, said: ‘The June manufacturing figures come off the back of two positive announcements for the sector, namely Ellesmere Port transforming into an electric vehicle assembly site for Stellantis, and Nissan’s announcement to build a battery-manufacturing site in Sunderland.

‘Similar announcements are needed in the future if the UK is to maintain its position as a leading automotive manufacturer in the electric era.’

John Bowman's avatar

John has been with Car Dealer since 2013 after spending 25 years in the newspaper industry as a reporter then a sub-editor/assistant chief sub-editor on regional and national titles. John is chief sub-editor in the editorial department, working on Car Dealer, as well as handling social media.

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