Industry Brexit fears grow as automotive sector slowdown continues

With the latest figures from the UK car industry showing a double-digit decline in both domestic and overseas markets, the sector’s trade body has repeated calls for the UK to remain part of the customs union.

Data published this week (26th April) by the SMMT (The Society of Motor Manufacturers and Traders) shows that 147, 471 cars rolled of UK production lines in March. This represents a 13.3 percent year on year decline, fuelled by a 17.7 percent decline in domestic demand and an 11.9 percent decline in demand from export markets.


The figures mark the latest, and steepest, decline in what has so far been a disappointing year for the sector. Overall output in the first quarter fell by 6.3 percent, with demand from overseas customers dropping by 4.0 percent and the UK market declining by 14.1 percent.

Commenting on the figures Mike Hawes, SMMT chief executive, said, “A double-digit decline in car manufacturing for both home and overseas markets is of considerable concern. Following recent announcements on jobs cutbacks in the sector, it’s vitally important that the industry and consumers receive greater certainty, both about future policies towards diesel and other low emission technologies, and our post-Brexit trading relationships and customs arrangements. Maintaining free and frictionless trade is an absolute priority – it has been fundamental to our past success and is key to our future growth.”

The trade body has also flagged a decline in the commercial vehicle sector, which experienced a drop in demand for the seventh consecutive month. As in the car sector, the decline has been largely driven by a drop in demand in the domestic sector, with manufacture for domestic markets showing a 26.6 percent decline in the first quarter compared to the same period last year.

Commenting on these figures Hawes said: “With March marking the seventh month of negative growth for UK commercial vehicle manufacturing, it’s clear that economic and political uncertainty continues to take its toll on business confidence. Fleet investments are huge commitments so government must encourage fleet renewal through the right policies and incentives, and maintain the economic conditions needed to fuel growth in this important sector.”