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Friday, February 23, 2024

SMMT: UK Auto makes a million automobiles and welcomes £23.7 billion funding enhance


UK car manufacturing hit 1,025,474 models in 2023, in response to the newest figures revealed in the present day by the Society of Motor Producers and Merchants (SMMT)

UK car manufacturing hit 1,025,474 models in 2023, in response to the newest figures revealed in the present day by the Society of Motor Producers and Merchants (SMMT). With 905,117 automobiles and 120,357 industrial automobiles (CVs) produced, output was up 17.0% on the earlier 12 months. The easing of pandemic-related challenges, from chip shortages to lockdowns, and growing electrified mannequin manufacturing, mixed to drive annual output above a million for the primary time since 2019.1

Robust December performances for each automobile manufacturing, up 20.7% 12 months on 12 months, and CV volumes, up 80.3%, rounded off a optimistic 12 months, which noticed a revival of the business’s fortunes. Eight all-new cutting-edge fashions entered manufacturing in 2023, together with on the newly reopened Ellesmere Port EV solely plant,2 whereas some £23.7 billion of personal and public funding commitments have been made – greater than within the earlier seven years mixed – from Cowley to Sunderland; gigafactories to R&D amenities.3

These commitments will drive inexperienced financial development, create jobs nationwide and transition the sector to electrified car manufacturing, which has already hit file ranges in 2023. UK manufacturing of battery electrical (BEV), plug-in hybrid (PHEV) and hybrid (HEV) automobiles surged to 346,451 models, up 48.0% on the 12 months earlier than to account for nearly two fifths (38.3%) of total output.

General, UK automobile manufacturing rose 16.8% in 2023, its greatest development price since 2010, with the whole retail worth of all fashions made coming in at greater than £50 billion.4 Whereas 191,247 automobiles have been constructed for home patrons, the lion’s share of output was shipped abroad, proof of the contribution automotive exports make to the UK economic system. Yr on 12 months, exports rose 17.6% in contrast with a 13.7% rise in output for the British market.

The EU remained by far the sector’s largest international market, taking 60.3% of exports, with shipments up nearly 1 / 4 (23.2%) to 430,411 models. The US was the following largest vacation spot with a ten.3% share of exports (73,571 models), adopted by China with 7.2% (51,202 models), regardless of shipments to each slipping by -9.1% and -2.7% respectively. Turkey, conversely, noticed exports surge 223.8% to 27,346 models, making it the UK’s fourth largest international market forward of Japan, Australia, South Korea, Canada, UAE and Switzerland.

Mike Hawes, SMMT Chief Govt, mentioned,

Receding provide chain challenges, new mannequin introductions and a large £23.7 billion of funding put UK car manufacturing firmly again on monitor in 2023. Business will now deal with the supply of those commitments, transitioning the sector at tempo to electrical and scaling up the availability chain. With international competitors as fierce because it has ever been and amid escalating geopolitical tensions, each authorities and business should stay singularly targeted on competitiveness, with all the roles and development this may deliver. We’re in a a lot better place than a 12 months in the past, however the challenges are unrelenting.

Regardless of difficult market situations, British specialist, luxurious and efficiency automobile makers had one other bumper 12 months, with mixed volumes climbing 6.3% to 34,613 models, price an estimated £7.1 billion.4 Two high-performance all new electrical fashions entered manufacturing, in Goodwood and Hethel, proof of how electrification is being embraced by producers proper throughout the sector.

The sector additionally acquired a lift on the very finish of 2023 with the deferral of harder guidelines of origin for batteries and EVs traded between the UK and EU. The transfer will assist safeguard the competitiveness of the sector within the UK and Europe, offering worthwhile time for native battery and related element manufacturing to ramp up.

2024 is a pivotal 12 months to make this occur however headwinds stay, most instantly with assaults on delivery within the Crimson Sea elevating the spectre of delays and value pressures. Nevertheless, with the approaching risk of UK-EU guidelines of origin tariffs overcome, the newest unbiased outlook foresees UK automobile and lightweight van output rising by round 3% in 2024 to 1.04 million models with the potential to exceed 1.2 million models by the tip of this decade.

To realize this, the UK should guarantee it stays aggressive, and so the forthcoming Finances is a chance for presidency to introduce measures that can enhance the sector. These ought to embody extending Local weather Change Agreements so electrical car battery-manufacturing and its related provide chain are eligible for aid; making inexperienced vitality broadly accessible and reasonably priced; delivering on commitments to enhance grid connections; and taking motion to shut crucial labour and abilities gaps.

Fast supply of the federal government’s Superior Manufacturing Plan, full implementation of the Harrington Assessment suggestions, plus a commerce coverage that locations automotive on the coronary heart of all future negotiations would additionally assist the UK consolidate its restoration and turn out to be a world chief in more and more electrified car manufacturing.

1: 1,303,135 automobiles and 78,270 CVs made in 2019
2: Fashions from manufacturers: Aston Martin, Lotus, Rolls-Royce, Stellantis, Daf and Alexander Dennis
3: SMMT calculations based mostly on publicly introduced funding commitments, private and non-private, in UK automotive manufacturing and R&D 2023 from manufacturers together with however not restricted to: MINI, JLR, Tata and Nissan. Whole introduced funding 2016-2022 inclusive: £16.2 billion.
4: SMMT calculations based mostly on RRP and publically accessible info – £51.6 billion.

SOURCE: SMMT

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