UK car production down 42.8% in first half of 2020

UK car manufacturing sees weakest six months since 1954, with just 381,357 cars rolling off production lines so far this year

Car production in the UK declined 42.8 per cent year-on-year in the first half of 2020, with the coronavirus pandemic to blame.

Just 381,357 cars rolled off production lines in what was the weakest six months for UK car factories since 1954. Worse still, the damage caused by COVID-19 has led to 11,349 jobs having already been lost in the industry, according to the latest figures from the SMMT (Society of Motor Manufacturers and Traders).

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The market as a whole was down from 666,521 to 381,357 units in the first half of 2020, with the fall split fairly evenly. Production for the home market fell 45.7 per cent from 133,200 cars to 72,346, while the export market dropped 42.1 per cent from 533,321 to 309,011.

In the latest monthly figures, meanwhile, June 2020 saw the market decline 48.2 per cent year-on-year from 109,226 units to 56,594. Manufacturing for the home market saw a 63.8 per cent drop from 18,345 to 6,670, while exports fell 45 per cent from 90,791 to 49,924.

Although the UK’s lockdown has now ended and car factories are running again, the latest analysis suggests car production losses could total 1.46 million units by 2025 –  equivalent to just over £40 billion – if the British Government doesn’t manage to negotiate a free trade agreement (FTA) with the EU by the end of the year, resulting in the transition period ending on World Trade Organisation terms.

It’s now predicted that just over 880,000 cars will be manufactured in the UK this year – a 32 per cent decline from 2019 and the lowest total annual figure since 1957.

Mike Hawes, chief executive of the SMMT, said: “These figures are yet more grim reading for the industry and its workforce, and reveal the difficulties all automotive businesses face as they try to restart while tackling sectoral challenges like no other.

“Recovery is difficult for all companies, but automotive is unique in facing immense technological shifts, business uncertainty and a fundamental change to trading conditions while dealing with coronavirus.

“The critical importance of an EU-UK FTA is self-evident for UK automotive. Our factories were once set to make two million cars in 2020, but could now produce less than half that number, a result of the devastating effects of the pandemic on top of already challenging market conditions and years of Brexit uncertainty.

“This industry has demonstrated its inherent competitiveness and global excellence over the past decade. Its long-term future now depends on securing a good deal and a long-term strategy that supports an industry on which so many thousands of jobs across the country depend.”

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