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UK automotive car manufacturing June 2016

UK car production in 16-year high but Brexit means future uncertain

UK automotive car manufacturing June 2016Car production in the UK rose more than 10% in June 2016, to 158,641 vehicles, helping make the first six months of 2016 a 16-year high.

But the SMMT has warned that, with Britain’s post-Brexit future position in Europe still far from clear, the future may not be so rosy.

Indeed, a survey by the trade organisation shows 57% of members believe Brexit will be a bad thing for their business; just 8.3% say it will be positive.

More than 3 in 4 cars built in the UK are exported and the majority go to Europe; what’s more, nearly 60% of parts fitted to UK-built cars are imported from Europe.

Uncertainty over trade deals between the UK and EU are thus a huge headache for automotive business leaders.

Built in Britain, sent overseas

UK automotive car manufacturing June 2016

The production figures show that although UK-market demand was up 7.1%, demand from export markets, predominately the EU, swelled 14.9% – 695,139 of the 897,157 cars built in Britain in 2016 were exported.

“The latest increase in production output is the result of investment decisions made over a number of years, well before the referendum was even a prospect,” said SMMT chief executive Mike Hawes.

“These decisions were based on many factors but, primarily, on tariff-free access to the single market, economic stability and record levels of productivity from a highly skilled workforce.

“To ensure the sector’s continued growth, and with it the thousands of jobs it supports, these must be priorities in future negotiations.”

Brexit concerns from UK automotive business leaders include:

  • 68.4%: Tariffs or other barriers between the UK and EU
  • 66.4%: Losing access to EU trade deals
  • 66.1%: Being bound by EU regulations in which they have no say
  • 59.7%: Uncertainty over EU workers in the UK
  • 63.6%: Losing access to EU skills market
  • 52.7%: Drop in sales
  • 46.1%: Fall in investment

The SMMT adds that, of its members surveyed, a quarter are still unsure about what impact the European Referendum results will have on their business. For them, it’s too early to say – meaning the developments in post-Brexit Britain in coming months will be significant.

Nissan Great Britain

Brexit Remain vote ‘critical’ warns UK car industry

Nissan Great BritainThe UK automotive industry says a ‘Remain’ vote in this Thursday’s European Referendum is “critical to the future” of the industry – and has warned a vote to Leave for Brexit could jeopardise jobs and investment.

Supporting 800,000 jobs in the UK, the UK automotive industry is a major player and its trade body, the SMMT, has spoken today to deliver “absolute clarity on the sector’s position given recent misrepresentations.

“There should be no ambiguity about the sector’s views ahead of such a critical vote.”

SMMT chief executive, Mike Hawes, said a Remain vote will continue the automotive industry’s success, “rather than jeopardise it by increasing costs, making our trading relationships uncertain and creating new barriers to our single biggest and most important market, Europe.”

80% of cars built in Britain are exported, helping contribute £15.5 billion annually to the UK economy: nearly 6 in 10 go to Europe.

“Remaining will allow the UK to retain the influence on which the unique and successful UK automotive sector depends,” said Hawes.

Automotive industry leaders back Remain

The SMMT carried out a survey ahead of the campaigning period to find out members’ views on the European Referendum vote. 77% backed Remain; 9% backed Leave.

“Notably no large company said that an exit would be in their business’ best interests.”

Key reasons given for a remain vote by the SMMT include:

  • Unrestricted access to the world’s largest single market
  • The negotiating strength of the EU to secure international trade deals
  • The ability to shape technical regulations
  • Free movement of labour

The trade body has also today released statements from senior chiefs from Britain’s biggest automotive industry players.

Ken Gregor, Chief Financial Officer of Jaguar Land Rover: “Remaining in the EU – our largest market – will increase Jaguar Land Rover’s chances to grow, create jobs and attract investment in future technologies. Our European supply chain has been fundamental in helping us to meet customer expectations worldwide and achieve sustainable, profitable growth.”

Tony Walker, Deputy Managing Director, Toyota Motor Manufacturing UK: “After considered review, we believe that continued membership of the European Union is best for our business and for our competitiveness in the longer term.”

Dr Ian Robertson, Member of the Board of Management, BMW AG: “We firmly believe Britain would be better off if it remained an active and influential member of the EU, shaping European regulations which will continue to impact the UK whatever the decision on Thursday.”

Rory Harvey, Managing Director and Chairman of Vauxhall: “We are part of a fully integrated European company where we benefit from the free movement of goods and people. We believe not to be part of the EU would be undesirable for our business and the sector as a whole.”

Ferrari Maserati service centre

The average Brit spends £695 a year maintaining their car

Ferrari Maserati service centreBritish motorists collectively spend a staggering £21.1 billion a year on servicing and repairing their cars, reveals a new report by the SMMT – one of the highest figures per person in the world.

This means that British cars are among the best-kept in the world, which is particularly good news for safety and emissions.

This has the happy benefit of meaning there are fewer cars on our roads in a bad state of disrepair (and when you do spot such shoddy-looking, smoke-billowing motors, they stand out like a sore thumb).

With 42,500 service and repair garages in the UK, there’s no shortage of choice for motorists either: and the SMMT reckons 345,000 British jobs are supported in looking after our 30 million-plus cars.

The Importance of the Aftermarket to the UK Economy report says this generates £12.2 billion for the UK economy.

And it’s only going to grow: more cars than ever are consistently being sold new, which will all need looking after. SMMT figures predict the UK aftermarket will be worth £28 billion by 2022 – and employ 400,000 people. It’s never been a better time to be a qualified vehicle technician.

Mike Hawes, SMMT chief executive, said,“The UK’s aftermarket is one of the most competitive in the world and plays a critical role in keeping Britain’s 30 million-plus cars roadworthy.”

Such a plethora of car garages is a good thing too, he added: “Robust competition and a strong independent sector have helped reduce the cost of vehicle ownership in the UK and provided greater choice to consumers.”

The Volkswagen Golf was the second best-selling car in May

The Volkswagen Golf was the second best-selling car in May

The Volkswagen Golf was the second best-selling car in May

The Society of Motor Manufacturers and Traders (SMMT) has revealed that new car registrations were up 2.5% last month – with the Volkswagen Golf beating the Vauxhall Corsa and Ford Focus to second place.

Naturally, the Ford Fiesta clings onto number one spot, with 8,236 registered last month – out of a total of 203,585 vehicles registered in May.

Despite the ongoing ‘Dieselgate’ emissions scandal, joining the surprise boom of Volkswagen Golf popularity is the increased demand for diesel cars – which rose by 5.0%.

The Volkswagen Golf was the second best-selling car in May

Petrol models saw a marginal decline of 0.6%, while registrations of alternatively-fuelled vehicles increased by 12.1%.

SMMT chief executive, Mike Hawes, said: “The new car market in May remained high with compelling offers available on the latest vehicles, but the low growth is further evidence of the market cooling in the face of concerns around economic and political stability.

“Whether this is the result of some buyers holding off until the current uncertainty is resolved or a sign of a more stable market for new cars remains to be seen.”

A substantial 1,164,870 cars have now been registered in 2016 – 4.1% ahead of the same period last year.

Growth is slowing down, though, says the SMMT – with May being the second consecutive month of sub-3% growth in registrations, hinting an increased market stability.

Dieter Zetsche

Europe ups its forecast car sales growth for 2016

Dieter ZetscheCar sales in Europe will grow in 2016 by more than double what was originally forecast, Daimler boss and president of the European car maker trade body Dieter Zetsche has announced.

The European Automobile Manufacturers’ Association (ACEA) president says a 5 per cent step-up in 2016 new car sales is now the expectation, up from ACEA’s January target growth of 2 per cent.

The upwards forecast “would mean over 14 million cars sold,” said Zetsche, with commercial vehicles also growing “substantially”.

But the industry shouldn’t yet get too excited, he added. “It’s important to note that we are still below pre-crisis levels of 15.5 million units. We need political partners who continue to stand by the principles of free trade and are determined to safeguard the positive momentum of our industry.”

Upwards growth of European new car sales is particularly good news for the UK: in 2015, 77 per cent of cars built here were sold overseas, with the EU accounting for 57.5 per cent of them. Our next-biggest automotive trade partner is the United States, where we send 10.9% of cars built here.

At a recent industry test day, the SMMT preferred not to comment on the risks to this EU trade of a Brexit vote, preferring instead to point out nearly 800,000 Brits are employed in automotive, with exports worth almost £35 billion accounting for 11.8 per cent of the UK’s total export goods.

Infiniti Sunderland

Brits buy fewer homegrown new cars in April – but Europe buys far more

Infiniti SunderlandUK car production grew for the ninth month running in April 2016 – but it was demand from overseas, particularly Europe, that drove this growth, as British buyers actually bought fewer cars built in Britain last month.

Nearly 150,000 cars were built in Britain last month, an increase of 16.4% on 2015. However, cars built here for UK buyers actually fell by 8%, to fewer than 28,000 cars.

It was demand from overseas for British-built cars that swelled production here: demand was up 23.7%, to nearly 122,000 cars. This means that 81.5% of cars built in Britain were exported, up from 76.7% last year.

And where are the majority of them heading? To Europe, which the SMMT says is by far our biggest export destination.

“Britain’s car manufacturing sector continues to thrive with a steady domestic market and surging demand from overseas,” said SMMT chief executive Mike Hawes.

“This growth represents a significant endorsement of the strength and quality of the UK automotive industry.”

The SMMT adds that 160,000 Brits are directly employed in automotive manufacturing, which accounts for 11.8% of all UK exported goods value. This adds £15.5 billion of value to the UK economy and the industry helps support almost 800,000 jobs in total.

Volkswagen Golf

Volkswagen Golf sales surprise in April 2016 new car registrations

Volkswagen GolfThe UK new car market grew 2% in April 2016, continuing its ongoing upward trajectory – but it’s the Volkswagen Golf’s impressive number two position in the registrations chart that’s the real surprise.

Pipping the Ford Focus, Nissan Qashqai and Vauxhall Astra, the Golf’s strong performance comes despite the ongoing ‘dieselgate’ emissions crisis – and runs contrary to recent reports that the public has lost faith in the Volkswagen brand.

A strong April means the Golf is now in a solid fourth place in the year-to-date new car registrations table, closing in on the Ford Focus. The Volkswagen Polo remains sixth, with the Audi A3 in eighth making it three Volkswagen Group cars in the top 10.

If the emissions crisis is having an impact anywhere, it’s certainly not on the new car market for Volkswagen…

Of course, the Ford Fiesta remains the clear new car sales leader, more than 2,000 cars ahead of the Golf in April alone. Year to date, more than 44,000 Fiestas have been registered. Next best is the Vauxhall Corsa, way back on fewer than 29,000.

Mike Hawes, SMMT chief executive, said, “After such a strong March, April’s steadier performance was to be anticipated, and is in line with our expectations for the year.

“Consumer confidence remains high as buyers continue to capitalise on attractive finance deals, although this could be affected by political and economic uncertainty in the coming months.”

Top 10 new car registrations – April 2016

  1. Ford Fiesta
  2. Volkswagen Golf
  3. Ford Focus
  4. Nissan Qashqai
  5. Vauxhall Astra
  6. Volkswagen Polo
  7. Vauxhall Corsa
  8. Mercedes-Benz C-Class
  9. Kia Sportage
  10. Audi A3
SMMT

Overseas demand drives 2016 boom in British carmaking

SMMTBritain built a car every 16 seconds in the first quarter of 2016 as increasing demand from overseas markets drove a 10.3% growth in UK car manufacturing.

Nearly 445,000 cars were built in Britain in the first three months of the year, with nearly 160,000 built in March alone – that’s a car every 16 seconds, says the SMMT.

And demand from abroad has gone up during 2016, with production for foreign markets up 14.3% in March alone. 3 in 4 cars built in Britain are now exported overseas.

Mike Hawes, SMMT chief executive, said: “UK car plants were at their busiest for 12 years in March thanks to heightened international demand for British-built cars.

“Much will depend on economic and political conditions in key markets but, with several brand new global models starting production here in the first quarter alone, the prospects for future growth look bright.”

Particularly as UK car workers are productive ones: last year, each employee in car manufacturing generated almost £80,000 in value-added GDP per car produced – that’s more than twice the national average.

The one potential cloud is the possible threat from a vote for Brexit: more than half of that 75% of UK car production sent abroad goes to members of the EU…

White van

Britain's white vans top 4 million for the first time

White vanA boom in British new van sales has seen the total number on UK roads top the 4 million mark for the first time, thanks to a combination of business confidence and internet shopping.

There are now 4,007,331 vans in use on British roads, more than 4% more than this time last year – and further new vans sales growth of 1.2% to date this year means 2015’s total of 370,000 new van sales continues to grow in 2016.

In the past four years alone, the total number of vans on British roads has grown by around 400,000.

It’s very good news for the British economy, said SMMT chief executive Mike Hawes, as “commercial vehicles have never been more important”.

SMMT Vans on the road 2016

CVs, the SMMT revealed as the 2016 Commercial Vehicle Show opens its doors at Birmingham’s NEC, cover 61 billion miles a year in the UK – and vans account for 45 billion of that (that’s 75%).

Around 3,000 tonnes of goods are transported by road every minute, three times more than rail and water combined.

As the surge in online deliveries continues, so too is the boom in new van sales expected to continue. Luckily, then, there’s a record number of new vans and pickups being launched at this year’s CV show, including models from Citroen, Fiat Professional, Isuzu, Peugeot, Renault and Toyota.

There’s even a blast from the past at the NEC this year – LDV is back in Birmingham, with an Irish importer set to unveil a new V80 van from the now Chinese-owned firm. Even if it does look rather like the old Maxus that used to be sold here…

White van

Britain’s white vans top 4 million for the first time

White vanA boom in British new van sales has seen the total number on UK roads top the 4 million mark for the first time, thanks to a combination of business confidence and internet shopping.

There are now 4,007,331 vans in use on British roads, more than 4% more than this time last year – and further new vans sales growth of 1.2% to date this year means 2015’s total of 370,000 new van sales continues to grow in 2016.

In the past four years alone, the total number of vans on British roads has grown by around 400,000.

It’s very good news for the British economy, said SMMT chief executive Mike Hawes, as “commercial vehicles have never been more important”.

SMMT Vans on the road 2016

CVs, the SMMT revealed as the 2016 Commercial Vehicle Show opens its doors at Birmingham’s NEC, cover 61 billion miles a year in the UK – and vans account for 45 billion of that (that’s 75%).

Around 3,000 tonnes of goods are transported by road every minute, three times more than rail and water combined.

As the surge in online deliveries continues, so too is the boom in new van sales expected to continue. Luckily, then, there’s a record number of new vans and pickups being launched at this year’s CV show, including models from Citroen, Fiat Professional, Isuzu, Peugeot, Renault and Toyota.

There’s even a blast from the past at the NEC this year – LDV is back in Birmingham, with an Irish importer set to unveil a new V80 van from the now Chinese-owned firm. Even if it does look rather like the old Maxus that used to be sold here…