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03 October, 2019 -
Car production in the UK almost halved in April as most manufacturers temporarily shut down factories due to Brexit uncertainties.
UK car production dropped 44.5% in April to 70,971 units, marking the 11th consecutive month of decline, according to the Society of Motor Manufacturers and Traders (SMMT). Manufacturing for domestic and overseas markets fell 43.7% and 44.7%, 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”, said the SMMT.
The decline in volumes is expected to ease by the end of the year, provided the UK leaves the European Union with a deal and a “substantial” transition period, but output is forecast to be around 10.5% lower than 2018 levels. “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”, said Mike Hawes, Chief Executive, SMMT. “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”, he added.
The automotive industry in the UK accounts for £82 billion (US$103.2 billion) turnover and £20.2 billion (US$25.4 billion) value added. It directly employs around 186,000 people in manufacturing and 856,000 across the wider automotive industry. The sector accounts for 12.8% of total UK export of goods and invests £3.65 billion (US$4.59 billion) each year in automotive R&D.