Domestic demand slows UK car production

Car manufacturing output declined in October according to figures published by the industry on Thursday, with domestic demand falling and exports strengthening again.

The Society of Motor Manufacturers and Traders (SMMT) said UK car manufacturing in October 5% on the preceding month and 1.0% year-on-year to 151,795 units.

Production for the domestic market fell 10.9% YoY, following the 10.6% decline last month

Despite the fall, domestic demand remains strong with production in the year so far up 3.3% at its highest level since 2005.

Out of the total, 122,765 or 80.9% were exported to customers abroad, with exports continuing to rise YoY for the 15th consecutive month by 1.7% but compared to September, exports slipped slightly from 123,119 units.

Although car production stalled in October, the industry remains strong with over 1.4m cars were produced in 2016, hitting a 17 year record at the same time as uncertainty over the UK industry’s position in the global market post Brexit has prompted manufacturers to urge the government to help protect the sector in trade negotiations.

Nissan has been given promises of “support and assurance” from the government to persuade the Japanese car maker to build both the new Qashqai and the X-Trail SUV at its Sunderland plant.

SMMT chief executive Mike Hawes said: “Given this dependence on global trade, it is crucial that British-built cars remain attractive to international buyers and exports are not subject to additional tariffs, costs and other barriers to successful trade. It is also essential government ensures there is economic stability and a competitive business environment to ensure we continue to attract the global investment that is behind this performance.”