UK car production output lowest since 2010

Hawes has made clear to the Government, including business secretary Andrea Leadsom, the SMMT’s position on what a future trade deal should look like, and while he doesn’t know whether the Government would extend the current transition phase beyond the current 31 December deadline, he does expect the UK’s position on what that trade deal should look like to become clear in the space of a few months to allow the delayed investment decisions to be made.

Should the UK diverge from the EU regulations in the automotive industry, there have already been warnings from the likes of Volvo boss Hakan Samuelsson that the range of models offered would be reduced to British buyers due to the increased costs and complexities of meeting regulations for an additional market. Some 400 models are offered for British buyers, so each would need to be developed to meet UK regulations, with associated costs. 

Fresh investment into the UK car industry stood at £1.1 billion in 2020, most of which came from Jaguar Land Rover’s announcement that it would build electric cars including the next Jaguar XJ in the UK. That figure is 60% lower than the rolling seven-year average of £2.75bn into the UK industry, which has benefited from many of its highest-volume models having been committed to being produced in the UK before the Brexit decision. While production in the UK should stay largely stable to the short to medium term, it’s investment in replacements for these cars and additional models that has not been forthcoming. 

There was better news in 2019 for the UK’s smaller, specialist car makers, including the likes of Bentley and Rolls-Royce, whose combined production rose 16.2% to just over 30,000 units. Alternatively fuelled vehicle production, including hybrids, plug-in hybrids and electric cars, also increased by more than a third, to total just under 200,000 of all vehicles produced.

The SMMT projects that there will be a further fall in UK car production in 2020, dropping to 1.27m units, despite there being an expected positive impact from the likes of the Sunderland-built all-new Nissan Juke and the first full-year production of the Toyota Corolla in Derbyshire.

An all-new Nissan Qashqai, Britain's most-exported new car, will have its first full year in production in 2021. That should help compensate for some of the lost production when Honda’s Swindon plant closes at the same time.

Key numbers

Top 5 most exported UK cars

Nissan Qashqai

Mini

Toyota Corolla

Honda Civic

Range Rover Sport