British car manufacturing down 14.2% in 2019
30 January 2020
Author: Illya Verpraet
The SMMT has published British car manufacturing figures for 2019 and the results aren't good, with manufacturing down 14.2%, the lowest since 2010.
The number of cars manufactured in Britain has fallen for the third consecutive year to 1.3m units, although the number of alternatively fuelled vehicles was up 34.7%
Output was affected by a number of factors, such as weakened consumer and business confidence in the UK, slower demand in key overseas markets, a number of significant model production changes, a shift away from diesel across Europe and factory shutdowns in the spring and autumn that were timed to mitigate expected disruption of planned Brexit dates.
With the UK now set to actually leave the EU tomorrow, it is rather worrying that 81% of cars were built for export, with the vast majority (54.8%) of those headed for EU countries. A further 18.9% of British-built cars went to the USA, 5.3% went to China and 3.2% to Japan.
Manufacturing for exports was down slightly more than for the domestic market, at -14.7% versus -12.3%. 1,055,997 cars were exported, while 247,138 were sold in the UK.
Last year saw a welcome £1.10bn of fresh automotive investment publicly announced for the UK. The bulk of that investment, however, was from one company looking to expand electric vehicle production in the West Midlands.
With 2019's investment tally some 60% lower than the £2.75 billion averaged over the previous seven years, the SMMT says that it's clear that more must be done to encourage overseas investors to follow suit.
There is some good news, however. Toyota recently launched a new Corrolla hatchback and estate, and as a result, its production in the UK was up 14.7%.
In addition, small-volume car manufacturers' output was up 16.2%, ans alternatively-fuelled vehicle production was up 34.7% to 192,304 units. The SMMT says that the UK is well-placed to lead the charge in ultra-low and zero emission vehicle development and manufacturing - if the right business conditions are in place.
Mike Hawes, SMMT chief executive, said: "The fall of UK car manufacturing to its lowest level in almost a decade is of grave concern. Every country in the world wants a successful automotive sector as it is a driver of trade, productivity and jobs. Given the uncertainty the sector has experienced, it is essential we re-establish our global competitiveness and that starts with an ambitious free trade agreement with Europe, one that guarantees all automotive products can be bought and sold without tariffs or additional burdens.
"This will boost manufacturing, avoid costly price rises and maintain choice for UK consumers. Negotiations will be challenging but all sides stand to gain and this sector is up for it.
"Meanwhile, the latest independent production outlook downgrades expectations for 2020 to 1.27m units, down from the 1.32m forecast made in November [by AutoAnalysis]. To arrest this decline and ensure the future competiveness and success of UK automotive manufacturing, negotiations on the future UK-EU relationship - and trade deals with the rest of the world - must move quickly and deliver for this critical sector.