Car manufacturing in Britain fell for the seventh consecutive month in February, with 145,475 models being rolled off of production lines.
The figure, published by the Society of Motor Manufacturers and Traders (SMMT), equates to a 4.4% decline on the same month of 2017. The fall was largely driven by domestic demand, which was down by 17% to 28,336 units for the month.
Exports were down by a much less significant 0.8%, with 117,139 now being shipped abroad – ensuring that Britain’s car exports now account for more than 80% of overall demand.
The month continued a trend of decline for the year-to-date, which is now 2.3% below this point in 2017 with 292,956 cars rolling out of UK production plants. Domestic demand for the year to date is 11.9% down, although exports are up 0.3% so far.
SMMT boss Mike Hawes said: “Another month of double-digit decline in production for the UK is of considerable concern, but we hope that the degree of certainty provided by last week’s Brexit transition agreement will help stimulate business and consumer confidence over the coming months.
“These figures also highlight the scale of our sector’s dependency on exports, so a final deal that keeps our frictionless trade links with our biggest market, the EU, after December 2020 is now a pressing priority.”
The SMMT pointed to the growing role of exports to emphasise the importance of securing a tariff-free trade deal with Europe. It said that the UK’s car industry delivers £22.8 billion directly to the Treasury each year, so damaging its competitiveness could lead to another “cliff-edge” in output numbers.
Hawes said: “The next major hurdle will be securing a new, comprehensive trade agreement with the EU and our partners across the world.” He added that while the government’s Industrial Strategy and Automotive Sector Deal, which sets out plans designed to increase the competitiveness of the UK car industry, are “positive steps”, concrete action is needed “if we are to stay ahead in what is an intensely competitive global environment”.
The SMMT’s recent Production Outlook report forecasts that the UK car manufacturing industry, which employees 169,000 people, will continue its trend of output decline, with 1,729,000 units expected in 2018. But the report predicts positive decisions to provide the potential for production growth to begin again in 2023.