Car making slips just 1.4% in November despite lockdown

Car factories in the UK managed to produce 106,243 units last month, despite most of November being subject to a second national lockdown.

Year-on-year outputs slipped by just 1.4 per cent, figures reveal, with car manufacturers allowed to remain open during the raised restrictions – though showrooms were closed to customers.

Announcing the figures this morning, the Society of Motor Manufacturers and Traders said the marginal fall in output had been masked by a ‘particularly weak November 2019 when precautionary factory shutdowns in anticipation of a potential ‘no deal’ Brexit on 31 October depressed output’.

The trade body used the November report to make yet another final plea for the UK government to reach an agreement for trade-free access to the EU market from 1 January.

The SMMT has made another plea for the Government to secure a Brexit trade deal

The SMMT said: ‘November saw 1,501 fewer cars made than in the same month last year, as many of the factors present throughout much of 2020 conspired to dampen domestic orders, not least a second national lockdown in England and subsequent economic and political turbulence.’

Export volumes remained flat, up just 0.3 per cent and equivalent to a rise of 310 units, boosted by shipments to key markets in the EU, Asia and the US.

The trade body said that more than eight in 10 cars, at 85.3 per cent, built in November were produced for export, highlighting the ‘critical importance’ of free and fair trade with global markets to UK car makers.

In the 11 months to November, total UK car production is now down almost a third (31 per cent) compared with the same period in 2019, representing a loss of 380,809 models at a cost of some £10.5 billion to the sector. 

This puts the industry on course to produce fewer than a million cars this year for only the second time since the early eighties. 

It is facing a tough future with potential further production losses amounting to £55.4 billion over the next five years if the sector is forced to trade on WTO conditions in a No Deal Brexit.

An aerial view shows Lines of new Honda cars parked up at the Royal Portbury Dock in Avonmouth, near Bristol in south-west England. The SMMT says that more than 8 in 10 new cars built in the UK are exported to overseas markets

Mike Hawes, SMMT chief executive, said: ‘Yet another decline for UK car production is of course concerning, but not nearly as concerning as the New Year nightmare facing the automotive industry if we do not get a Brexit deal that works for the sector. 

‘With just nine days to go, the threat of ‘no deal’ is palpable and the sector, now also reeling from the latest coronavirus resurgence, Tier 4 showroom lockdowns and disruption at critical UK ports, needs more than ever the tariff-free trading arrangements on which our competitiveness is founded.’

Mr Hawes made a final desperate bid for ministers to agree a deal with Brussels for a tariff-free agreement with the EU for the automotive sector.

It comes after Honda earlier this month halted production of cars at its Swindon plant, which is responsible for output of the Civic model for Europe, because of the difficulties in sourcing parts.

The plant will permanently close in July next year with the loss of 3,500 jobs. 

‘It is finally make or break time, as being forced to trade on WTO terms would be a hammer blow for many automotive businesses, workers and their families, so we must get a deal – and one that avoids the devastation of punitive tariffs for all automotive products, from day one,’ Hawes warned.

‘For the long-term survival of UK Automotive, there is quite simply no other option,’ he added.