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3 minute read - 28th July 2023

Strong first half for car and commercial vehicle production

British car and commercial vehicle manufacturing both had a positive first half of 2023, with car production seeing double-digit growth and commercial vehicle production achieving its best first half since 2011.

UK car production rose 11.7% in the first half of the year to 450,168 units, with June – up 16.2% – the fifth consecutive month of growth, according to the latest figures published by the Society of Motor Manufacturers and Traders (SMMT). The performance represented the best first half since 2021 as manufacturers were increasingly able to manage global supply chain challenges – notably the shortage of semiconductors – that had constrained production since the pandemic.

Since January, factories have produced an additional 47,037 units, the uplift having been driven by exports which have surged 13.6% to 359,940 units, representing eight-in-ten cars made. Volumes for the UK are up too, rising 4.5% to 90,228 units. However, year-to-date output remains -32.5% below 2019 levels, a reflection of structural changes in the sector but also pointing to the opportunity for UK car makers to recover if a globally competitive business investment environment can be assured.

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British car and commercial vehicle manufacturing both had a positive first half of 2023, with car production seeing double-digit growth and commercial vehicle production achieving its best first half since 2011 / Picture: KUKA

UK commercial vehicle manufacturing grew 16.0% in the first six months of the year as 58,675 units rolled off factory lines, with June marking the third consecutive month of growth. Some 11,748 units were produced in June, up 23.0%, marking the best first half year for UK van production since 2011, as supply chain constraints continue to ease.

First half year production was 67.0% up on pre-pandemic 2019 volumes, with growth driven by overseas demand. Exports of the latest British-built commercial vehicles rose 26.7% compared to the same period last year, at 37,803 units. This growth is set to continue throughout the rest of the year, on the back of new model activity and, notably, the expected opening of a new electric van production facility in the North West.

The latest independent outlook therefore forecasts light commercial vehicle production to grow 44.0% to around 114,500 units this year. Volumes are then expected to rise again in 2024 to nearly 150,000 units providing economic conditions allow and the UK-EU trading relationship of electric vehicles continues to operate as it does today.

First half year commercial vehicle production is 67.0% up on pre-pandemic 2019 volumes / Picture: DAF Trucks

Mike Hawes, SMMT chief executive, said, “UK car manufacturing is growing again, with production – especially of electrified models – increasing and major investment announcements making headlines. This is testament to the resilience of the sector and its undoubted strengths – a skilled and productive workforce, world-class R&D, and efficient, productive plants. But we must build on this momentum, sustain growth and attract further investments with a strategy that focuses on competitiveness and which strengthens the UK’s unique automotive offering.

“Commercial vehicle output has continued to buck the challenging economic conditions, reaching record levels. This is good news for the sector, for jobs and for the wider economy. With growth set to continue, and some positive investment announcements into UK auto recently, there is increased positivity within the industry. We must now build on this recovery, ensuring we stay competitive and attract more global investment to scale up our EV supply chain and position the UK as a world-class destination for vehicle manufacturing.”

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