It seems the UK’s car factories hit a big speed bump in July. According to the latest figures from the Society of Motor Manufacturers and Traders (SMMT), car production took a detour, dropping by 14.4 per cent. With just 65,478 vehicles rolling off the assembly lines, July wasn’t exactly a high-octane month for the industry. But what’s behind this slowdown? Well, it turns out that the automotive sector has been juggling a few too many balls at once.
The main culprits? The SMMT explains model changeovers and some temporary supply chain hiccups. Essentially, the factories have been busy retooling for new models, which has slowed things down, and we feel like we’ve heard this before. Let's not forget the ongoing supply chain challenges though, that continue to plague industries worldwide – because what’s a car factory without a few missing chips or parts?
UK new car production, July 2024
"Following significant growth last year, some readjustment in output was to be expected. Indeed, an ongoing degree of volatility is likely as the industry restructures to transition to zero-emission vehicle production. As the billions already committed to new models start to deliver a return, volume growth will resume, providing we seize every opportunity to enhance our global competitiveness," Mike Hawes, SMMT Chief Executive, commented.
Despite the overall dip in production, there’s still a silver lining – sort of. Electrified vehicles (we’re talking battery electric, plug-in hybrid, and hybrid models) managed to hold their ground. Sure, their volume shrank by 18.6 per cent, but these eco-friendly rides still made up a solid 37.5 per cent of all the cars produced. Not too shabby, especially when you consider they accounted for 39.5 per cent in July last year. It seems the UK is still sparking interest in greener cars, even if the numbers aren’t as electrifying as before.
Things are not looking pretty for the UK car industry:
On the home front, production for the UK market dipped by a modest 5.1 per cent, which in real terms means 672 fewer cars were produced for local buyers. But let’s be honest, the UK market isn’t the main act here – it’s all about exports. Over 80 per cent of the cars made in July were destined for far-off shores, with the EU leading the charge (snagging 51.3 per cent of exports). The US, China, Turkey, and Japan also parked themselves in the top five markets, though export volumes overall took a 16.3 per cent nosedive.
Despite the July slump, the year-to-date figures paint a more mixed picture. Domestic production is actually up by 14.8 per cent, but export volumes have sputtered, down 14.3 per cent. Yet, even with these bumps in the road, the total value of UK automotive production still revved past the £20 billion mark – a figure that’s managed to stay in cruise control compared to last year.
Source: SMMT