UK car manufacturing output fell -15.3% in October, the eighth
consecutive month of decline, according to the latest figures
published today by the Society of Motor Manufacturers and Traders
(SMMT). 77,484 units left factory gates, 14,037 fewer than in the
same month last year, with plants continuing their retooling to
enable production of the next generation of zero emission
vehicles.
24,719 battery electric, plug-in hybrid and hybrid electric cars
were made, representing almost a third (31.9%) of output, despite
a volume decline of -32.6%. Since January, UK car makers have now
turned out a combined 239,773 electrified vehicles, with 71.8% of
them exported to global markets.
Overall, volumes for both domestic and export markets declined in
October, down -4.7% and -17.6% respectively, with eight-in-10
cars shipped abroad and more than half of these (32,170 units)
heading into the EU, although total volumes fell by -34.6%.
Exports to the next largest market, the US, meanwhile, surged
96.2% to 14,584 units, thanks to increasing shipments of the UK's
luxury and premium models.
In the year to date, UK car production has now slipped -10.8% to
670,346 units, due primarily to falling exports. While production
for the UK is up 5.3% to 159,125 units, exports are down -14.8%
to 511,221 units, equivalent to 89,095 fewer cars being shipped
overseas in the first ten months.
Manufacturers announced more than £20 billion worth of investment
last year to drive their transition to EV production, a massive
sum demonstrating the industry's commitment to net
zero.1 With weak new car markets in the UK and EU, the
latter up just 0.7% from January-October, however, the latest
independent production outlook has downgraded expectations for UK
car and light van production.2 It anticipates
factories turning out some 911,000 vehicles this year, and
839,000 in 2025, around a third less than the near 1.4 million
cars and light vans made in 2019 pre-Covid.3
If planned UK zero emission model launches stay on track and
consumer demand improves, there is potential to get above one
million units in 2028. If not, output would remain below one
million units until 2030, and in a worst-case scenario drop to
fewer than 750,000 should plants close and others have reduced
model lineups, which would have a devastating effect on the
sector, jobs and economic growth.
The news follows a series of announcements by manufacturers and
suppliers, in the UK and Europe, reflecting challenging market
conditions and a slowdown in the transition to electrification.
Ensuring the UK remains a globally competitive location for
advanced vehicle manufacturing, therefore, requires an industrial
and trade strategy that works for the sector and, in addition, a
healthy domestic market, given car makers build close to where
they sell. Government must work in partnership with industry to
deliver market regulations that support consumers and industry,
including measures to address the UK's high cost of energy and
the signing of trade deals built on free and fair
trade.
Mike Hawes, SMMT Chief
Executive, said, “These
are deeply concerning times for the automotive industry, with
massive investments in plants and new zero emission products
under intense pressure. Slowdowns in the global market –
especially for EVs – are impacting production output, with the
situation in the UK particularly acute given we have arguably the
toughest targets and most accelerated timeline but without the
consumer incentives necessary to drive demand. The cost of
stimulating that demand and complying with those targets is huge
and, as we are seeing, unsustainable. Urgent action is therefore
needed and we will work with government on its rapid review of
the regulation and the development of an ambitious and
comprehensive Industrial Strategy to assure our competitiveness.”
