UK car industry on ‘RED ALERT’ as production slumps by almost a TENTH

February 1, 2019
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Just over 1.5 million cars left UK factories in 2018, a drop of 9.1 percent on the previous year and the lowest for six years. Production of diesel cars was down by 22 percent to 561,000 last year. It comes as investment by car companies fell by half in 2018 to £588m as firms were left cautious of ongoing Brexit negotiations. The Society of Motor Manufacturers and Traders (SMMT) said investment had effectively “stalled” amid fears over Britain crashing out of the European Union without a deal in place.

SMMT chief executive Mike Hawes said the fall in investment was “deeply depressing”.

He said: “With fewer than 60 days before we leave the EU and the risk of crashing out without a deal looking increasingly real, UK Automotive is on red alert.

“Brexit uncertainty has already done enormous damage to output, investment and jobs.

“Yet this is nothing compared with the permanent devastation caused by severing our frictionless trade links overnight, not just with the EU but with the many other global markets with which we currently trade freely.

“Given the global headwinds, the challenges to the sector are immense.

“Brexit is the clear and present danger and, with thousands of jobs on the line, we urge all parties to do whatever it takes to save us from ‘no deal’.”

Car production for the UK fell by 16 percent last year, while exports were down by 7.3 percent, including 9.6 percent in Europe and 24 percent in China.

But it was not all bad news as exports to Japan increased by 26 percent and by 23 percent to South Korea, but the SMMT pointed out that both countries were subject to preferential EU trade agreements.

Exports to the US increased by 5.3 percent, leaving it the UK’s second biggest customer after the EU.

A Department for Business, Energy & Industrial Strategy spokesman said: “As we leave the European Union we will seek the broadest and deepest possible agreement that delivers the maximum possible benefits for both the UK and EU economies and maintains the strength of our world-leading automotive sector.

“The automotive industry is a great UK success story, one we are working to grow through our modern Industrial Strategy, Automotive Sector Deal and research funding including millions for the creation of next generation batteries.”



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