First rise in 11 months for UK car production

UK car production up 13.3% in May, the first growth after 10 consecutive months of decline.

UK car production grew for the first time since June 2021 in May, up 13.3%, with 62,284 units leaving factory gates, according to figures released today by the Society of Motor Manufacturers and Traders (SMMT). This rise, which comes despite the closure of a major car plant last year, along with key model changeover at another, must, however, be viewed in context against May 2021, which was still suffering significantly from pandemic related headwinds. Indeed, output remains -46.3% below the pre-pandemic month in 2019, with ongoing supply chain issues, increasing economic uncertainty, rising business costs and disruption caused by the war in Ukraine.

Production for both overseas and domestic markets increased in May, by 8.9% and 39.5% respectively. Exports accounted for 82.1% of all new cars built, with almost six-in-ten of these destined for the EU. Shipments to the US decreased by -35.4%, with the closure of a major UK plant in 2021 continuing to affect export levels across the Atlantic.

Positively, UK car makers continued to build the latest and greenest zero and low emission models at pace with an increase in output of battery electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs) and hybrid electric vehicles (HEVs). BEVs increased by 108.3%, while more than one-in-five (22.6%) of all cars built last month was alternatively fuelled, up from 19.3% last year.

In the year to date, overall output has decreased by more than a fifth (-23.2%), with supply chain constraints, most notable the shortage of semiconductors, constricting volumes, with just 330,185 units built – a shortfall of some 99,641. This has largely been driven by a -26.9% decline in exports and a further -4.5% fall in production for the domestic market.

This news comes in the same week as new analysis from SMMT revealed manufacturers are facing a £90 million increase on their energy bills, which are already 59% higher than the EU average. In its new report, From Full Throttle to Full Charge, SMMT is calling on the government for urgent action to enhance UK Automotive’s competitiveness and safeguard manufacturing as the sector transitions towards zero emission motoring.

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