Brexit: UK car production slumps 4% in February as industry demands 'frictionless' trade with EU

Output for domestic market sees particularly marked decline of 17%

Ben Chapman
Thursday 29 March 2018 00:40 BST
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The SMMT said on Wednesday that while a newly agreed transition deal 'provides some welcome breathing space'
The SMMT said on Wednesday that while a newly agreed transition deal 'provides some welcome breathing space'

British car manufacturing output fell by 4.4 per cent in February while output for the UK market registered a double-digit monthly decline, the industry’s trade body said.

Production for the domestic market, which accounts for a minority of the UK car industry, plummeted 17 per cent on the previous month to 28,336 vehicles, the Society of Motor Manufacturers and Traders (SMMT) said on Thursday.

The figure is the seventh consecutive monthly decline in production for the domestic market.

Exports remained relatively steady, dipping 0.8 per cent to 117,139. More than eight out of ten cars assembled in the UK are destined for overseas, the SMMT said.

Mike Hawes, the SMMT's chief executive, said: “Another month of double-digit decline in production for the UK is of considerable concern, but we hope that the degree of certainty provided by last week’s Brexit transition agreement will help stimulate business and consumer confidence over the coming months.

“These figures also highlight the scale of our sector’s dependency on exports, so a final deal that keeps our frictionless trade links with our biggest market, the EU, after December 2020 is now a pressing priority.”

The figures come just a day after the trade body issued its latest warning about the future of the UK’s car industry.

The SMMT said on Wednesday that while the transition deal “provides some welcome breathing space” the industry still needs to see rapid progress and clarity on many fronts.

The UK’s continued ability to trade freely with the EU is essential, the SMMT said, but there are a number of other important factors at play.

“Business rates, capital allowances and energy costs, for instance, must all be globally competitive; training and skills for a productive workforce must focus on new technologies and the UK supply chain must be attractive to investment,” the trade body said.

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