Production takes another hit from the home market in November while exports grow by 1.3%
Sam Sheehan
21 December 2017

UK car production was dealt its biggest blow of the year in November as domestic demand plummeted by 28.1%.

This ensured a fall in output of 4.6%, or a drop of 7757 units, to 161,490 cars compared with the same month in 2016.

November was the fourth consecutive month of decline in UK demand. In contrast, global demand remained defiant and actually grew to 137,214 units in November. However, this 1.3% improvement on November 2016 wasn’t enough to offset the UK's overall decline in output in the period.

Brexit uncertainty, coupled with confusion over diesel taxation and air quality plans, continues to impact domestic demand for new cars and, with it, production output,” explained Society of Motor Manufacturer and Traders CEO Mike Hawes.

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“Whilst it is good to see exports grow in November, this only reinforces how overseas demand remains the driving force for UK car manufacturing. Clarity on the nature of our future overseas trading relationships, including details on transition arrangements with the EU, is vital for future growth and success.”

New legislation announced with the autumn budget will see drivers of new diesel vehicles hit with higher taxes. SMMT president Tony Walker recently said last month's 30.6% fall in demand for diesel vehicles is disrupting “the new car market” and therefore “hampering investment in the electric, emission-free vehicles of tomorrow”.

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In October, domestic demand fell by 2.9%. Predictions for Britain’s 2017 car production output were then downgraded by 700,000 units to 1.73 million.

In January-November, British output totalled 1,577,0422 cars, a 2% fall on the same period in 2016. Again, this trend is driven by tumbling demand from the home market, which is 9% short on the same period last year, while exports remained consistent.

A total of 1,254,491 UK-built cars have been sent abroad, marking a 355-unit improvement on the first 11 months of 2016.

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Comments
33

21 December 2017

Brexit is causing the cost of living to rise.   We're simply getting less for our money whenever you visit the supermarket.   Official inflation figures hides "shrinkflation", yet so many products have shrunk for the same price.

 

Jobs are at risk with Brexit too.   Why?   Because business is at risk of failure or downsizing to survive with fewer customers.

 

This knocks confidence.   And the warnings against diesel cars hasn't helped.   But it's people worried that they won't have enough to buy (or effectively rent via various PCP schemes) a new car.   However you dress it up, this is all because of:

Brexit.

 

21 December 2017

Brexit... yawn... erm ... VW Diesel scam + dodgy PCP schemes now exposed + giant road tax hikes after years of unsustainable cuts = short arms, deep pockets syndrome and fewer car sales

 

21 December 2017
Marcus Mackay wrote:

Brexit... yawn... erm ... VW Diesel scam + dodgy PCP schemes now exposed

 

There's a lot to be said for buyers who ask how much per month the car will cost?   They don't care so much about the purchase price, just the price per month and if the dealer can reduce it further.   Even Autotrader's app now has cost-per-month as well as purchase price to rank listings with.

 

With Brexit (yes, boring but true) putting earnings under pressure you just don't know if in a year's time you can still afford that cost per month.   That's knocking the confidence of the UK buyer.

 

Why else is it uniquely a Brittish problem that's not being felt globally?   Brexit is your answer.

 

21 December 2017

I'm sure you’re a great guy, but you’re missing the point. No other country has introduced £3650 a year toxin taxes in recent months, this has scared everyone . Owners of hybrid cars I know have seen their second hand prices  go up as Londoners dump their diesels. As another commentator pointed out there is more too this. Most markets are about confidence and Brexit aside, the UK car market has been hit hard by the diesel scandal. In the US the majority of VW sold are petrol while the US market hasn’t been rocked by a complete overhaul of the car tax system, the opposite, they’re enjoying the Trump Bump. I personally am outraged that one of our cars has seen a big drop in its value as it is diesel, even though it is a 2014 model and in theory is clean. So everyone is in wait and see mode for good reason. I expect that the car market for diesels right now only exists at all because of company car buyers who are less concerned by second hand prices. The motor industry in the UK is in crisis and while I do agree Brexit isn’t helping, it really isn’t the cause, like the decision to call an election recent decisions on all sides have been dumb, our Government and the Mayor of London need to be held to account for once again not working out the concequences of their action. The really annoying thing about all this is that Diesel cars in London while causing a lot of congestion, only cause 11% of all pollution. It’s all an over reaction to bad science. They say pollution is causing many thousands of extra deaths per year, yet cyclists who obviously breath in lots of this nasty air have half the cancer rates of society as a whole. 

 

 

21 December 2017
Symanski wrote:

Why else is it uniquely a Brittish problem that's not being felt globally?   Brexit is your answer.

Living beyond your means, or more specifically in this case, car finance, is a uniquely British problem.

21 December 2017
So car sales fell in November, but general retail sales rose in November, because of Brexit?

Of course!

21 December 2017

Fact 1 - VW falsified their emissions exposing the complete emissions sham. The market for diesels collapses. 

Fact 2 - the PCP market created a bubble which again has reached the end of the road, you may try it once, but feel the full cost at the end of the scheme and your  enthusiasm will be dampened. 

Fact 3 - Government has screwed with taxes further undermining confidence, no one really understands the new system and why buy a new car and get hit for road tax when the old car in many cases pays none.

No other aspect of UK spending has dropped so sharply, if at all. 

So let’s not blame Brexit, let’s sort the car industry and create clean vehicles and dare I say it honest and sustainable finance options. And finally get rid of road tax and put a few pence on fuel. 

 

 

21 December 2017

In the USA VW sales last month were up year on year 309,305 to 285,719 for the year before, overall sales total car sales flat 0.2% increase, think there is more to the drop in sales than RFL changes and the VW scandel in the UK market.

21 December 2017

In the USA VW sales last month were up year on year 309,305 to 285,719 for the year before, overall sales total car sales flat 0.2% increase, think there is more to the drop in sales than RFL changes and the VW scandel in the UK market.

21 December 2017

Is there no figure provided for imports to the UK?

The number of imported vehicles would help to provide a more complete picture when compared against domestic output.

In esence, what I want to know is: Is the trade deficit in motor vehicles narrowing?

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