UK car output up 40% in September, as SMMT calls for delay to Brexit tariffs
UK carmakers increased output by nearly 40% in September, but industry leaders have warned of the imminent threat of new Brexit rules that could see the cost of electric vehicles rise by over £3,000.
Car manufacturing across British factories increased 39.8% year-on-year to 88,230 vehicles last month, some 25,105 more than September 2022, according to the figures published Thursday by the Society of Motor Manufacturers and Traders (SMMT). This was the strongest month of 2023 so far and the best September output since 2020.
Year-to-date production now totals 659,901 units, up 14.9% on last year.
"A particularly strong period of car making is good news for the UK, given the thousands of jobs and billions of pounds of investment that depend on the sector," said SMMT's chief executive Mike Hawes.
"With countries around the world shifting to zero-emission motoring, Britain is well placed to be a global EV manufacturing hub if the investment and trading conditions are right."
Electrified vehicles now account for 37.5% of total outbound shipments from the UK, up from 26.4% in September 2022.
However, the SMMT called for tariff-free trade set out in the UK-EU Trade Cooperation Agreement (TCA) to be maintained. From January 2024, under new tougher 'rules of origin' requirements for batteries as part of Brexit, 45% of the value of an electric vehicle must originate from the UK or EU to qualify for tariff-free trade.
"Failure to comply will result in a 10% tariff which if fully passed on would raise the average cost of UK-built battery electric vehicles (BEVs) by £3,600 in Europe, while EU-made BEVs sold in the UK would see an average £3,400 price hike," the SMMT said.
Hawes called for a three-year delay to the new requirements, which he said would "give the necessary breathing space for automotive sectors on both sides of the Channel to scale up gigafactories and green supply chains, both of which are essential for a stable, long-term transition".
"Given the increasing importance of electrified car production, the first and urgent step is for the UK and EU to agree to delay the tougher rules of origin requirements that are due imminently," he said.