Car makers face ‘very tough’ conditions as up to 30% of workers self-isolate

A global microchip shortage is adding to the problems affecting the motor industry.

Staff shortages hitting car industry
Staff shortages hitting car industry

Up to 30% of workers in some automotive companies are self-isolating, adding to the “very tough” conditions facing the industry, it has been revealed.

The Society of Motor Manufacturers and Traders (SMMT) said factories built 69,097 cars last month, the worst June total since 1953 apart from Covid-affected June last year.

Staff shortages caused by workers having to self-isolate, coupled with a global chip shortage, hit production, said the SMMT.

The industry has faced a “turbulent” six months, with the pandemic, new trading rules with Europe and supply issues causing ongoing challenges, the society said.

Almost half a million cars rolled off production lines in the first half of the year, down by 38% on the five-year average, representing a loss of 311,160 cars worth more than £8.5 billion, said the trade body.

Chief executive Mike Hawes said some firms which supply car manufacturers are suffering from a 30% shortage of staff.

The SMMT has joined other industry groups in calling for the August 16 date for allowing fully vaccinated, and tested, people to continue working rather than self-isolating, to be brought forward.

More than four in five cars built in this country so far this year were exported, just over half to the EU, followed by the United States (18.8%), China (7.8%), Japan (1.9%) and Australia (1.8%).

Production of battery electric (BEV), plug in hybrid (PHEV) and hybrid electric (HEV) vehicles accounted for almost one in four of all cars built.

Mr Hawes said, “While the UK automotive industry continues to suffer the effects of the global pandemic, with first half year production down significantly and a tough few months looming, the sector has the capability to recover.

“The latest investments into new models and battery production show a bright future is within reach, yet the industry still faces headwinds most notably from global semiconductor shortages and staff absenteeism as a result of staff being ‘pinged’.

“Businesses have ensured their facilities are Covid secure but urgent action is needed, such as bringing forward the 16 August target date for exempting fully vaccinated adults from self-isolation and introducing a ‘test to release’ scheme to support those employees not yet fully vaccinated.”

Mr Hawes said recovery from the impact of the pandemic would be slow, with billions of pounds worth of car production down on where the industry should be, adding: “We are still in the eye of the storm.”

The previously announced closure of Honda’s factory in Swindon on Friday was “deeply disappointing” and would cost the industry a significant amount of capacity, said Mr Hawes.

But he pointed to over £600 million of investment announced in the first half of the year as evidence that the industry remains “fundamentally strong”.

A Government spokesperson said: “Self-isolation remains an essential tool in our national efforts to reduce the spread of Covid-19.

“We are working closely with businesses to help them understand how the exemption for named, critical workers operates and what to do if their staff are eligible.

“This is a short-term and highly focused measure intended to apply only in exceptional circumstances, with the core purpose of preventing significant harm to public welfare as a result of disruption to critical services.”

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