UK car and commercial vehicle output falls in April

UK car and commercial vehicle production fell by -15.8% to 59,203 units in April, according to the latest figures published this week by the Society of Motor Manufacturers and Traders (SMMT). Vehicle output fell to the lowest level for the month since 1952, excluding 2020 when the first Covid-19 lockdown effectively saw manufacturing cease. The result caps off the sector’s lowest start to the year since 2009.
 
April’s decline in car output was driven by a combination of factors, notably the later timing of Easter – which saw fewer production days in the month (and hence a factor behind the comparative rise in output in March) – as well as model changeovers and lower demand in key export markets. As a result, car production fell -8.6% to 56,534 units. Commercial vehicle (CV) output also declined by -68.6% to 2,669 units, driven primarily by a plant closure and normalising demand for new heavy goods vehicles (HGVs) following robust post-pandemic growth.
 
Car production for export fell -10.1%, while production for the domestic market – always a smaller proportion of volumes – also decreased, by -3.3%. Shipments to the UK’s two largest global markets, the European Union (EU) and USA, fell by -19.1% and -2.7% respectively, although the EU still took more than half of all exports while the USA received 16.5%. Conversely, exports to China and Turkey rose by 44.0% and 31.2% respectively.
 
Meanwhile, CV export volumes fell sharply by -75.8% with just over half (50.7%) of output heading overseas. The decline was driven by a -78.9% drop in shipments to the EU, but the bloc retained the lion’s share of exports at 84.9%. CV output for the domestic market also softened, down by -54.6%.
 
Economic uncertainty
With production constrained by economic uncertainty and rapidly changing global trading conditions, industry awaits publication of the Government’s industrial strategy, which must contain measures that boost the competitiveness of Britain’s most valuable export sector. A strategy with automotive and advanced manufacturing at its heart will enable the sector to take advantage of the UK’s new trading arrangements, including those agreed with the EU and the USA – while exploring possibilities for growth in other markets, notably India, delivering economic benefits across the UK.
 
Mike Hawes, SMMT chief executive, said: “With automotive manufacturing experiencing its toughest start to the year since 2009, urgent action is needed to boost domestic demand and our international competitiveness. The Government has recognised automotive manufacturing’s critical role in driving the UK economy, having successfully negotiated improved trading conditions for the sector with the USA, EU and India in the space of a month.” 

He concluded: “To take advantage of these trading opportunities we must secure additional investment which will depend on the competitiveness and confidence that can be provided by a comprehensive and innovative long-term industrial strategy. Get this right and the jobs, economic growth and decarbonisation will flow across the UK.”