UK car manufacturing fell by a fifth in the first half of 2019, with a year-on-year drop in June marking 13 consecutive months of negative growth, according to figures released Wednesday by the Society of Motor Manufacturers and Traders.
A total of 666,521 cars were produced in the first six months of this year, a year-on-year loss of 168,052 units, or 20.1%, “due largely to falling demand in key markets, including the UK, exacerbated by factory shutdowns pulled forward in anticipation of the March Brexit deadline,” SMMT said. June output was 109,226 units, down 15.2% from the year-earlier period.
“Today’s figures are the result of global instability compounded by ongoing fear of ‘no deal [Brexit],'” said Mike Hawes, SMMT’s chief executive.
“This fear is causing investment to stall, as hundreds of millions of pounds are diverted to Brexit cliff-edge mitigation — money that would be better spent tackling technological and environmental challenges,” he added.
In June, output for the UK rose by 2,791 units following an anomalous 47.2% decline in the same month last year when preparation for the new WLTP emissions test affected volumes. The underlying trend, however, remains downward, with year-to-date production for the domestic market down 16.4%, SMMT noted.
The number of cars built for export fell by 19.8% in June and by 21.0% in H1 in the face of “softening of key overseas markets and global trade tensions,” the group said.
The UK automotive sector has already spent at least GBP 330 million ($401 million) on “no deal” Brexit contingency plans, while inward investment into the sector “effectively stopped” in the first half of the year,” SMMT said.
“In the period January-June, newly pledged investment was down more than 70% to GBP 90 million, contrasting with the average annual investment figure of GBP 2.7 billion over the previous seven years,” the group said.
— Andy Blamey