UK car production almost halved in August

Car manufacturing plummeted 44.6 per cent due to continuing Covid-19 crisis and stalling consumer demand

Car production in the UK fell 44.6 per cent year-on-year in August 2020 as a result of the ongoing Covid-19 crisis, as well as low demand from consumers both home and abroad.

Only 51,039 cars rolled off production lines during the month, compared with 92,153 in August 2019. Continuing restrictions and the implementation of local lockdowns across various parts of the UK meant many factories have not been able to get back up to full capacity.

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Furthermore, August 2019 was an unusually strong month for car manufacturing, as factories moved their summer shutdowns forward to April in anticipation of the original Brexit date, which ended up being delayed. As such, August 2020 looks particularly weak in comparison.

August 2020 also saw weak demand domestically and internationally. Only 7,795 cars were built for UK buyers – down 58.3 per cent – while 73,443 were made for foreign buyers – down 41.1 per cent, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).

UK car production is down 40.2 per cent in the year-to-date – a loss of 348,821 units. That decline is split between 46 per cent for the home market and 38.8 per cent internationally. Manufacturers have lost in excess of £9.5 billion due to Covid-19, while 13,500 jobs in the industry are known to have been cut.

Mike Hawes, chief executive of the SMMT, said: “These are increasingly disturbing times for UK car makers and suppliers with the coronavirus crisis weighing heavily on the sector. Companies are bracing for a second wave with tighter social and business restrictions making the industry’s attempts to restart even more challenging.

“The UK industry is fundamentally strong and agile, and the measures announced yesterday by the Chancellor are welcome and essential, although we await more details of how they will work for all businesses and crucially large manufacturers. Companies need to retain skilled jobs and maintain cashflow and we may need more support to boost business and consumer confidence later this year.

“Moreover, with fewer than 100 days until the Brexit transition period ends, we need urgent agreement of an ambitious free trade deal with our largest market to avoid the second shock of crippling tariffs.”

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