UK car, commercial vehicle production on the up in July

UK car manufacturing output rose 8.6% in July, making for the third consecutive month of growth, while commercial vehicle production was ahead 43.9% in that sector’s best July since 2016, according to a fresh batch of industry data on Thursday.

The Society of Motor Manufacturers and Traders (SMMT) said car production rose for the third month in a row to 58,043 units.

It did, however, caution that the July 2021 comparator was the worst July since 1956, as car makers faced a number of issues including the global shortage of semiconductors and pandemic-fuelled staff absences.

Factories turned out 4,605 additional cars in July 2022, in what the industry body called a sign that component shortages could finally be easing.

Output still remained 46.4% below pre-pandemic levels, however, illustrating that full recovery was some way off.

Production for the UK market specifically surged 40.7% to 11,583 units, with exports also up, but by a more modest 2.8%, in part reflecting the “structural and model changes” at play.

“A third consecutive month of growth for UK car production is, of course, welcome and gives some hope that the supply chain issues blighting the sector may finally be starting to ease,” said SMMT chief executive Mike Hawes.

“But other challenges remain, not least energy costs which are increasing at alarming rates.”

Hawes said that to attract “much-needed” investment to drive the production of zero-emission vehicles, urgent action would be needed to mitigate the costs to make the UK more competitive for manufacturing.

“This must be a priority for the next prime minister, else we will fall further behind our global rivals, risking jobs and economic growth.”

At the same time, UK commercial vehicle production grew 43.9% year-on-year in July, with 8,097 units of vans, buses, trucks, coaches and taxis rolling off British factory lines.

The SMMT said output in July was the highest for the month since 2016,1, rounding off the “best performing first seven months to a year” in a decade, with 58,693 commercial vehicles built in Britain so far in 2022.

“The commercial vehicle sector continues to provide a shining example of successful UK automotive manufacturing with the best year to date performance since 2012,” Mike Hawes said.

“This is testament to the quality of commercial vehicles made in Britain, which are in high demand at home and abroad.”

However, Hawes said the continued success of the export-led sector was not guaranteed, amid “some of the toughest” economic conditions in living memory.

“Urgent action is needed to bring down the high energy costs faced by automotive factories if their competitiveness is to be sustained.”

Reporting by Josh White at Sharecast.com.