UK July car production declines as exports take a hit

British car manufacturing output declined by almost 11% in July to 108,239 units, according to figures released Thursday by the Society of Motor Manufacturers and Traders. This was the 14th successive month of decline as ongoing weakness in major EU and Asian markets coupled with some key model changes affected performance.

Production for export fell by 15% in the month, although overseas demand remained the main driver of overall volumes, accounting for 8 in 10 cars built, the association said.

Output for the domestic market rose by 10%, or just fewer than 2,000 units, following a steep 35% fall in July last year, when multiple factors — including preparation for WLTP — affected output.

Year-to-date, some 774,760 cars have been made in Britain, 180,864 fewer than in the same period last year, representing a fall of 19%. With exports accounting for the vast majority of orders, their decline is primarily responsible for the overall fall in output with overseas shipments down by 20% since January, while year-on-year production for the UK is down by almost 14%.

“Another month of decline for UK car manufacturing is a serious concern. The sector is overwhelmingly reliant on exports and the global headwinds are strong, with escalating trade tensions, softening demand and significant technological change,” SMMT Chief Executive Mike Hawes said, again underlining the importance of maintaining the UK’s global competitiveness with a Brexit deal “to unlock investment and safeguard the long-term future of a sector which has recently been such an international success story.”

— Annalisa Villa