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UK car manufacturing plummets as Brexit shutdowns strike

Time 9:14 am, May 30, 2019

BRITISH car manufacturing plummeted by almost half in April, according to figures published today by the Society of Motor Manufacturers and Traders.

A total of 70,971 cars rolled off production lines in the month – down by 44.5 per cent year on year as factory shutdowns, rescheduled to mitigate against the expected uncertainty of a March 29 Brexit, took effect in many plants across the UK.

Manufacturing for domestic and overseas markets fell by 43.7 per cent and 44.7 per cent respectively as most volume manufacturers brought forward, and extended, production stoppages normally scheduled for the summer holiday period.

The shift in shutdown, which cannot now be repeated for a October 31 deadline, was part of a raft of costly and ongoing contingency measures, including stockpiling, rationalisation, training for new customs procedures and rerouting of logistics – all designed to try to protect business when the UK leaves the customs union and single market.

Source: SMMT

April’s dismal performance – the 11th straight month of decline – exacerbated the underlying downward trend, largely because of  slowing demand in key international markets, including the EU, China and the US, as well as at home.

In the year to date, 127,240 fewer cars have been built compared with the same period in 2018 – a decline of more than a fifth (22.4 per cent ) – with similarly large percentage falls in production for the UK and export.

Provided the UK leaves the EU with a favourable deal and substantial transition period, and notwithstanding any escalation of global trade tensions, the decline in volumes is expected to ease by the end of the year, said the SMMT, as new models come on stream and production lines remain active over the usual summer shutdown months.

However, the latest independent outlook – commissioned from AutoAnalysis – suggests output will still be down some 10.5 per cent on 2018 levels. A ‘no deal’ Brexit, however, could exacerbate this decline, with the threat of border delays, production stoppages and additional costs compromising competitiveness.

Mike Hawes, SMMT chief executive, said: ‘Today’s figures are evidence of the vast cost and upheaval Brexit uncertainty has already wrought on UK automotive manufacturing businesses and workers.

‘Prolonged instability has done untold damage, with the fear of ‘‘no deal” holding back progress, causing investment to stall, jobs to be lost and undermining our global reputation.

‘This is why ‘‘no deal” must be taken off the table immediately and permanently, so industry can get back to the business of delivering for the economy and keeping the UK at the forefront of the global technology race.’

MORE: Car manufacturing down 14.4 per cent in March

MORE: February’s decline in car production ‘should serve as wake-up call’

MORE: Car production falls by more than 18 per cent in January

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