New data from the Society of Motor Manufacturers and Traders (SMMT) reveal a steady growth in UK car manufacturing in May, with 119,338 cars built – a rise of 2.3%. The strong domestic market once again played a significant part with a 13.3% increase outweighing a small dip in production for export.
The industry is gearing itself up for a more prolonged period of growth in the mid- to long-term as multi billion pound investments will see new models reach production lines.
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Mike Hawes, SMMT chief Executive, said: “We have seen a steady performance in UK car manufacturing this year with volumes bolstered by a strong home market, while recovery in key European markets is helping to restore export production levels.
“Long-term, the picture is promising: ‘Built in Britain’ is still in high demand all over the world, with buyers attracted not only by iconic brands but also by the high quality of our engineering. With a significant number of new models due to start production in the coming months, we anticipate a strong, sustained upturn in output volumes in the years ahead.”
There was a much larger boost to UK commercial vehicle production last month as 6,808 vans, trucks and buses were made – a 32.8% rise year on year. Data for the first five months of 2015 further demonstrate a CV manufacturing resurgence with production volumes up by almost a quarter.
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By GlobalDataThe sector benefited from increasing European demand in May, as exports rose 69.4% last month to 3,710 vehicles. Half of all commercial vehicles produced in 2015 have been exported.
“May’s strong figures consolidate the UK commercial vehicle manufacturing sector’s return to form, following a more subdued period over the past couple of years when changes to type approval legislation disrupted fleet renewal patterns,” said Hawes.
“Continued demand for high quality British engineering, growing business confidence and regulatory stability have helped to fuel steady growth for both the domestic and export markets.”
There has, however, been a drop in engine ouput this year.
Hawes said: “UK engine manufacturing remains relatively stable for the year to date and although May registered a drop in production, it is encouraging that despite retooling efforts for Euro-6 production, volumes surpassed the all important 1m unit mark last month. We are optimistic that growth will return to the sector over the coming months as UK-produced Euro-6 manufacture gets underway ahead of the September deadline and major new engine plants come on stream later in the year.”
John Leech, head of automotive for KPMG UK, said: “The strong domestic market continues to drive UK production, indeed it is still possible that new car sales in 2015 will beat the all-time record set in 2003.
“Overseas, it’s a mixed picture with the EU market’s recovery looking sustainable while Russia and China continue to be challenging.
“Year to date production is down 0.8% largely due to planned downtime ahead of new car launches such as the Land Rover Discovery Sport and Jaguar XE. We expect UK production to grow in 2015 and again in 2016 and 2017. We continue to forecast that in 2018 UK production will beat the record set in 1972.”
