Brexit uncertainty blamed as UK car manufacturing drops 9.8%

Production in the year so far is down 6.9 per cent compared with 2017, including a 12 per cent drop in the domestic market

UK car manufacturing fell 9.8 per cent in October, due to a combination of Brexit uncertainty, market turbulence and model changes, according to the Society of Motor Manufacturers and Traders.

The number of cars produced in October fell by 15,255 compared with the same month in 2017, with production for the home market dropping by 12.1 per cent in the fifth consecutive month of decline.

Meanwhile, production for overseas markets dropped 9.3 per cent, although exports still command the biggest share of total output at 82.7 per cent. In the year so far, production is down 6.9 per cent compared to 2017.

“The fifth consecutive month of decline for UK car manufacturing is undoubtedly concerning and, while a number of factors have been at play, there is no doubt that business and consumer uncertainty is having a significant impact,” said Mike Hawes, SMMT chief executive.

“With eight in 10 British-built cars destined for overseas markets, the majority to the EU, the sector’s dependence on exports cannot be downplayed.

“Europe is our largest trading partner and securing the right Brexit agreement which allows free and frictionless trade is vital for the future health of our industry.”

Car manufacturers have issued multiple warnings over the harm Brexit could do to the industry.

Jaguar Land Rover’s chief executive, Ralf Speth, has warned that tens of thousands of jobs in the UK motor industry are at risk if a no-deal Brexit goes ahead.

The company has already moved workers at its Castle Bromwich plant to a three-day week because of “continuing headwinds impacting the car industry”.

Meanwhile, Honda has said a no-deal scenario would cost it tens of millions of pounds, while BMW said it would move a planned shutdown of its Mini plant in Oxford forward to coincide with the beginning of Brexit in order to minimise the risk of disruption.