UK automobile manufacturing obtained off to a quick begin in January, in response to the newest figures from the Society of Motor Producers and Merchants (SMMT).
Volumes rose 21% to 82,997 models, marking one of the best January efficiency since 2021 and the fifth straight month of progress as world demand for British-built manufacturers continued to develop and legacy provide chain challenges, notably semiconductor shortages, abated.
The majority of manufacturing was for export (75.8%), with abroad shipments up 11.6% to 62,938 models – an increase of 6,559. Nonetheless, output for the home market commanded the largest quantity progress, up by a further 7,863 models (+64.5%).
The EU was the most important world marketplace for British-built automobiles, taking greater than half (53.2%) of exports, adopted by the US (15.0%), China (10.5%), Japan (2.8%) and Australia (2.3%). Shipments to the EU, US and China all rose, by 5.0%, 81.1% and 33.2% respectively.
UK manufacturing of battery electrical (BEV), plug-in hybrid (PHEV) and hybrid (HEV) autos rose once more by a mixed 4.5% to 29,590 models to account for 35.7% of total output. In keeping with total figures, the vast majority of these fashions had been exported, proof of the significance of not solely producing growing numbers of electrified automobiles however of making certain free and honest buying and selling preparations with markets around the globe.
Mike Hawes, SMMT chief govt, stated, “A constructive begin to the yr for UK automobile manufacturing bodes nicely for the business and the numerous hundreds of livelihoods on which it relies upon. There might be no room for complacency, nonetheless, given financial headwinds and geopolitical tensions. There have to be a relentless dedication to competitiveness, constructing on the numerous latest investments into the sector. The forthcoming Finances is an opportunity for Authorities to do exactly that by introducing measures to spice up UK automotive manufacturing, centered on power, funding competitiveness and market demand.”
Whereas the dimensions of any impacts on UK automobile manufacturing arising from assaults on delivery within the Pink Sea has but to be seen, the newest impartial outlook, made in November, foresees UK automobile and lightweight van manufacturing rising by some 3% in 2024 to 1.04 million models.
Lisa Watson, director of gross sales at Shut Brothers Motor Finance, commenting on the newest figures, stated: “While one other enhance in UK automobile manufacturing will present additional optimism for the yr forward, the Authorities’s zero emission automobile (ZEV) mandate, which requires 22% of latest automobiles manufactured this yr to be electrical, could trigger complications for producers.
“The Authorities’s £2bn pledge to the UK automotive manufacturing business on the again finish of 2023 was a step in the best route to make sure the UK retains up with battery manufacturing calls for. Nonetheless, producers will probably be maintaining an in depth eye on the Chancellor’s Spring Assertion subsequent week as extra must be achieved to speed up infrastructure growth, akin to putting in charging factors, if the UK is ready to assist widespread adoption to electrical autos (EVs).
“That is at the moment appearing as a barrier to EV adoption for customers, who’re nonetheless hesitant about making the swap. While 28% of these trying to buy a automobile this yr plan to purchase a hybrid, in response to our latest analysis, solely 12% plan on shopping for an EV – down from 14% final yr.”
Richard Peberdy, UK Head of Automotive for KPMG, added: “UK automobile manufacturing continues to scale-up its output, fuelled by manufacturing line investments for the event of hybrid and electrical autos, in addition to in new fashions of all gas varieties.
“Electrical automobile demand is basically being pushed by low benefit-in-kind tax and write-down allowances for companies, together with firm automobile and wage sacrifice schemes for workers. However rising non-public gross sales of latest EVs is proving difficult. The UK automotive business is hoping that the Finances comprises measures to incentivise client EV buying, while additionally hoping for additional measures to draw inward funding and increase the UK automobile business’s competitiveness.”
