UK car production down 10.6 per cent in July

Fourteenth consecutive month of decline for UK car manufacturing blamed on weak global markets and key model changes

UK car production fell 10.6 per cent in July 2019, marking the fourteenth consecutive month of decline.

Some 108,239 cars rolled off UK production lines in July 2019, compared with 121,051 in the same month last year. The home market saw a year-on-year growth of 10.2 per cent from 19,401 to 21,381, while the export market – which accounted for eight in every 10 cars built – fell 14.6 per cent from 101,650 to 86,858.

• UK best-selling cars

Overall, there has been an 18.9 per cent decline in UK manufacturing in the first seven months of 2019.

The Society of Motor Manufacturers and Traders (SMMT), which produced the figures, blamed the ongoing weakness in European and Asian markets, as well as a number of key model changes.

Mike Hawes, chief executive of the SMMT, commented: “Another month of decline for UK car manufacturing is a serious concern. The sector is overwhelmingly reliant on exports and the global headwinds are strong, with escalating trade tensions, softening demand and significant technological change.

“With the UK market also weak, the importance of maintaining the UK’s global competitiveness has never been more important so we need a Brexit deal – and quickly – to unlock investment and safeguard the long term future of a sector which has recently been such an international success story.”

It follows news from July that the automotive industry has spent at least £330 million on contingency plans in preparation for a no deal Brexit since the UK voted to leave the EU in June 2016.

No deal Brexit looms large

The continuing threat of a no deal Brexit is one of the causes for this decline, with a number of UK factories having brought their annual shutdowns forward from the summer to April 2019, impacting overall production for the first half of the year.

The SMMT revealed that manufacturers have spent £330m preparing for the possibility of a no deal Brexit since the UK voted to leave the EU in June 2016. In addition to moving the factory closures, this has involved stockpiling materials and components, securing warehouse capacity and investing in new logistics solutions, additional insurance and training in new customs procedures.

Slowing demand in key overseas markets also contributed to the decline, with global consumer confidence at a low point. Mike Hawes, chief executive of the SMMT, said: “Today’s figures are the result of global instability compounded by ongoing fear of ‘no deal’.

“This fear is causing investment to stall, as hundreds of millions of pounds are diverted to Brexit cliff-edge mitigation – money that would be better spent tackling technological and environmental challenges.”

With this in mind, Hawes wished the UK’s new prime minister Boris Johnson well in securing a deal with the EU by the Brexit deadline of 31 October, adding: “If we can get a deal, then the future of the industry is still very strong.”

What do you think of the UK car manufacturing decline? Let us know in the comments below…

Leave a Reply

Your email address will not be published. Required fields are marked *