UK vehicle production declined by -17.7% in the first month of the year, with factories turning out 71,104 cars and 6,908 commercial vehicles (CVs) for a total of 78,012 units, according to the latest figures published today by the
Society of Motor Manufacturers and Traders (SMMT). The performance follows a bumper January last year, when car and CV output surged by 21% and 27.5% respectively, and reflects weakness in key markets, notably the European Union (EU), China and the UK itself, compounded by planned model changeovers.
UK production of battery electric (BEV), plug-in hybrid (PHEV) and hybrid (HEV) vehicles increased 1.5% to 30,028 units, accounting for 42.2% of all cars made in January, the highest monthly performance since December 2022 (47.2%). The lion’s share of overall car production (80.4%) was for export, although volumes slipped -9.2% to 57,140 units. Production for the UK market, meanwhile, fell -30.4% to 13,964 units.
The EU, the largest global market for British-built cars, took more than half (52%) of car exports, followed by the USA (18.6%), China (6.2%), Turkey (3.5%) and Japan (3.4%). While shipments to the EU and China fell by -11.2% and -46.3%, those to the USA, Turkey and Japan all rose, up 12.4%, 36.9% and 8.1% respectively.
Year-on-year declineExport demand also continued to drive CV production, accounting for 61.7% of UK van, truck, taxi, bus and coach production. A total of 4,259 units were shipped overseas, a year-on-year decline of -46.6% with 97.1% destined for the EU. Volumes for the UK market also fell, down by -31.1% to 2,649 units. The SMMT says that the performance must be set in context, however, with a particularly strong January last year - which saw the best CV output since 2008 – compounding the decline.
The news comes amid plant restructuring and slower than anticipated roll-out of new models as manufacturers respond to softening demand in the UK and other key markets. Given the significant investments at stake, the industry is urging the Government to ensure the needs of the UK automotive sector are at the core of its forthcoming industrial and trade strategies.
These strategies must be combined with measures to ensure a healthy domestic market, especially for EVs – a key investment consideration – and quick release of the £2 billion promised by the Government to boost the sector via the Automotive Transformation Fund. Doing so would help shore up the competitiveness of the UK’s largest exporter of manufactured goods, a sector with the potential to deliver £50 billion in UK growth over the coming decade.
Mike Hawes, SMMT chief executive, said: “UK vehicle producers face a perfect storm of global trade uncertainty, challenging manufacturing conditions and a market transition which is proving tougher than expected. The sector is doing all it can to keep production plans on track but needs government to ensure automotive is at the heart of its forthcoming industrial and trade strategies with promised funding invested as soon as possible. Doing so will help ensure our competitiveness and safeguard the billions of pounds of investment, jobs and economic growth which is now at stake.”