POLITICIANS are being urged by the UK automotive companies “to do whatever it takes” to avoid a no deal Brexit as latest figures from the SMMT show British car production fell to its lowest level for five years in 2018.
Production declined 9.1% to 1,519,440 from UK factories, a second consecutive annual fall as the sector faces multiple challenges.
The SMMT also revealed that fresh inward investment in the sector plummeted in the year – down almost half on 2017 to just £588.6 million, amid fears over the UK’s future trading prospects with the EU and other key global markets after 29 March.
Regulatory changes and ongoing uncertainty over future diesel policy and taxation were exacerbated by declining consumer and business confidence.
Exports were also down, with output for overseas markets dropping -7.3% as slowdowns in important European and Asian markets took effect. UK car exports to China slumped 24.5% while EU demand fell by 9.6%.
Overall, EU27 countries still accounted for the vast majority of UK exports (52.6%) – amounting to 650,628 cars.
Mike Hawes, SMMT Chief Executive, said, “UK Automotive on red alert. Brexit uncertainty has already done enormous damage to output, investment and jobs. Yet this is nothing compared with the permanent devastation caused by severing our frictionless trade links overnight, not just with the EU but with the many other global markets with which we currently trade freely.
“Given the global headwinds, the challenges to the sector are immense. Brexit is the clear and present danger and, with thousands of jobs on the line, we urge all parties to do whatever it takes to save us from no deal.”
The decline in UK car manufacturing in 2017 and 2018 follows seven years of unprecedented growth for the sector as it emerged from recession faster than any other major EU market, with output rising more than 70% in that time.