Lowest car production figures for nearly a decade prompts calls for government action

Vehicle production in the UK has slumped for the first time in eight years.

Figures released by the Society of Motor Manufacturers and Traders (SMMT) revealed that 1,671,166 vehicles rolled off production lines last year, a three per cent decrease on 2016 (1,722,698).

A 9.8 per cent fall in production for the UK market drove the overall drop, with the SMMT blaming the decline in business and economic confidence – as well as confusion over the government’s policy on diesel – as key factors.

Car exports, which accounted for 79.9 per cent of total UK production, fell by 1.1 per cent with 1.34 million vehicles shipped worldwide.

Nevertheless, despite the slump, the total was still the second highest output in 17 years.

However, the figures are 130,000 units below SMMT’s mid-year forecast. This has been put down to lower than expected demand, primarily in the domestic market.

The trade association also released figures which showed investment in the industry fell by 33.7 per cent to £1.1 billion, down from £1.66 billion in 2016.

Chief executive Mike Hawes said: “The UK automotive industry continues to produce cars that are in strong demand across the world and it’s encouraging to see growth in many markets.

“However, we urgently need clarity on the transitional arrangements for Brexit, arrangements which must retain all the current benefits – or else around 10 per cent of our exports could be threatened overnight.”

Andy Barratt, chairman of Ford of Britain, said the firm had invested considerable amounts of money in its engine plants at Dagenham in Essex and Bridgend in South Wales, with both sites supplying the global market.

He predicted ‘stability’ for Bridgend, which has been at the centre of union fears of possible job cuts.

Len McCluskey, general secretary of Unite, said: “These figures really ought to ring alarm bells right across government.

“Our world-class car manufacturing sector is at risk – and much of the blame for this lies directly at the government’s door.”

A government spokesman said: “The UK’s automotive industry remains a great British success story and global demand for UK- designed, engineered and manufactured cars and engines remains strong.”