BREXIT BLAMED AS UK CAR PRODUCTION PLUMMETS 44.5% IN APRIL

Article Source: IMechE

Car production fell for the 11th consecutive month in April, with 44.5% fewer cars built than in the same month last year.

The Society of Motor Manufacturers and Traders (SMMT), which released the figures, said Brexit was to blame. Companies brought forward and extended factory shutdowns – usually scheduled for the summer holiday – to mitigate against the expected uncertainty of leaving the European Union on 29 March.

The SMMT urgently called for the government to take a ‘no deal’ Brexit off the table, saying ongoing instability was having a devastating impact on the UK’s automotive sector. The frontrunners in the Conservative leadership race to become the next Prime Minister, Boris Johnson and Dominic Raab, have both kept the option open however.

“Today’s figures are evidence of the vast cost and upheaval Brexit uncertainty has already wrought on UK automotive manufacturing businesses and workers,” said SMMT chief executive Mike Hawes.

“Prolonged instability has done untold damage, with the fear of no deal holding back progress, causing investment to stall, jobs to be lost and undermining our global reputation. This is why no deal must be taken off the table immediately and permanently, so industry can get back to the business of delivering for the economy and keeping the UK at the forefront of the global technology race.”

Factories produced 70,971 cars in April, with manufacturing for the domestic market falling 43.7% and overseas 44.7%. As well as bringing forward production stoppages, companies implemented contingency measures including stockpiling, training for new customs procedures and rerouting of logistics to protect against the effects of leaving the customs union and single market.

In the year to date, British factories have built 127,240 fewer cars than in the same period last year – a decline of more than a fifth. The SMMT said the almost year-long downward trend was largely due to falling demand in key international markets including the EU, China and the US.

“Provided the UK leaves the EU with a favourable deal and substantial transition period, and notwithstanding any escalation of global trade tensions, the decline in volumes is expected to ease by the end of the year, as new models come on stream and production lines remain active over the usual summer shutdown months,” said the SMMT announcement. “However, the latest independent outlook suggests output will still be down some 10.5% on 2018 levels. A no deal Brexit, however, could exacerbate this decline, with the threat of border delays, production stoppages and additional costs compromising competitiveness.”


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