UK automotive industry enjoys record year with £77.5bn turnover

Time 10:00 am, June 20, 2017

THE UK’s automotive industry turned over a record £77.5bn last year, according to figures released today by the Society of Motor Manufacturers and Traders.

The 2017 UK Automotive Sustainability Report, published by the SMMT, showed a seventh consecutive year of growth for the manufacturing sector, while productivity, production output and vehicle sales also rose. At the same time, the industry improved its environmental impact, with waste to landfill falling to a new low of 0.9 per cent of all waste produced.

UK car and commercial vehicle production and new vehicle registration volumes grew to record levels in 2016 – up 8.9 per cent and 0.2 per cent respectively. Meanwhile, employment in manufacturing stayed stable at 169,000 jobs, resulting in productivity reaching a record high of 11.8 vehicles produced for each person employed in the industry. The average manufacturing worker generated more than £130,000 for the British economy, up 9.8 per cent on 2015. The SMMT said the number of livelihoods dependent on the sector as a whole stood at 814,000 across manufacturing, retail, distribution and repair services.

The record turnover by UK motor manufacturing was a 9.0  per cent increase on 2015, with the additional value added to the UK economy rising 7.3 per cent to £21.5 billion. The industry also upped its investment in innovation, with research and design spend reaching £2.75 billion last year, up from £2.5 billion in 2015.

SMMT chief executive Mike Hawes, pictured, said: ‘Today’s results demonstrate how UK Automotive is delivering growth across the UK, boosting productivity and improving environmental performance. This has been driven by massive investment in new models, plants, innovation and one of the world’s most skilled workforces. However, for UK auto manufacturing to continue to thrive, we need clarity on the future, post-Brexit, to encourage ongoing investment and growth.’

Staff turnover fell to just five per cent in 2016 compared with the national average of 16.5 per cent. At the same time, investment in skills increased, with the number of days’ training per employee going up by 9.1 per cent. In addition, report signatories reported an intake of 870 new apprentices last year, on top of the 800 apprentices that were retained.

The sector’s improved social and economic performance was achieved while simultaneously reducing the environmental impact of its manufacturing processes. In 2016, carbon dioxide emissions per vehicle produced fell by 2.9 per cent, energy use per vehicle by 3.2 per cent and water use by 3.5 per cent. Waste to landfill was cut by more than a third (33.7 per cent) to a new record low of 0.9 per cent of all waste produced, with almost 90 per cent recycled.

The industry also continued to invest heavily in developing low-emission technology to address the air quality challenge. Alternatively fuelled vehicle registrations increased in 2016 by 22.2 per cent to account for 3.3 per cent of the market, making the UK the biggest market for plug-in electric cars in Europe. At the same time, average new car carbon dioxide emissions fell for a 19th year to 120.1g/km – 33.6 per cent below levels in 2000.

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