industry

UK car industry on brink as production crashes to worst levels since 1956


The latest set of figures from the Society of Motor Manufacturers and Traders (SMMT) revealed October to be the worst for the car industry since 1956. It was the fourth month of falling production with 64,729 cars produced, down on 110,458 in October last year. The poor October figures drag overall year-to-date output even lower, down -2.9 percent on last year despite 2020 being overshadowed by lockdowns and factory closures. SMMT Chief Executive Mike Hawes called the figures “extremely worrying”.

Mr Hawes added: “Britain’s automotive sector is resilient but with Covid resurgent across some of our largest markets and global supply chains stretched and even breaking, the immediate challenges in keeping the industry operational are immense.

“Government can help the industry with measures to boost competitiveness in line with global rivals, notably in tackling high energy costs, supporting employment and training, and helping businesses whose cashflow is under pressure from these historically poor production numbers.”

One of the biggest challenges to the car industry has been a global shortage in semiconductors which began in 2020 triggered by changing demands during the pandemic.

Shortages of the chips, which are used in products ranging from smartphones to home appliances, have continued throughout this year with JP Morgan recently forecasting improvements will be unlikely until the second half of 2022.

So far this year zero emission vehicles production has already exceeded pre-pandemic production levels in 2019.

The SMMT is now calling on the Government to step up support to improve infrastructure for those wanting to make the switch from petrol and diesel.

In a speech this week SMMT President Dr George Gillsepie said: “We have inspired the public to buy these exciting vehicles in numbers never seen before, but here is the twist.

“It is so frustrating to find broken chargers, blocked chargers, multiple apps, confusing payment schemes.

“This is quickly going to turn a lot of people off electric vehicles and all our work in developing these fantastic vehicles will be wasted.”

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Soaring demand for electric vehicles has increasingly outpaced the rollout of charging points with fears around access being a major barrier to many.

In his Autumn Budget Chancellor Rishi Sunak promised £817m to invest in improving supply chains and production for electric vehicles.

Speaking to the Confederation of British Industry this week Boris Johnson also announced plans to force developers to include charging points in all new homes and office blocks as well as some buildings undergoing renovation.





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