UK car industry records best October since 2019

According to the latest Society of Motor Manufacturers and Traders (SMMT) data, UK car makers produced 91,512 units last month, marking the best October performance since 2019.

While both domestic and overseas demand grew in October – up 23.9% and 33.4% respectively – it was exports that really drove output, accounting for 82.3% of all cars produced. In fact, more than eight in 10 cars produced in the UK last month were shipped abroad, with EU orders showing a significant uptick of 58.5%. The EU remains the UK’s biggest export market by far, accounting for almost two-thirds of exports (65.2%).

BEVs, PHEVs and HEVs on the up too

UK production of battery electric (BEV), plug-in hybrid (PHEV) and hybrid (HEV) vehicles also rose in October. Combined output was up 52.1%, representing four-in-10 (40.1%) of all cars made last month, a near record high. Since January, UK factories have turned out 287,408 of these models, up 59.1% on the year before and helping push overall car production up 16.7% to 751,422 units.

The SMMT said that given the strong manufacturing performance and recent round of investment into UK vehicle manufacturing as part of the government’s Advanced Manufacturing Plan, the latest independent light vehicle production outlook has been revised up accordingly. It is now anticipated that UK vehicle makers will produce 1,008 million cars and light vans in 2023, up 18.0% on last year, with further growth anticipated in 2024.2.

However, the SMMT added a caveat, stating: “This outlook is predicated on a workable solution to the EU-UK rules of origin requirements for batteries, which are due to get tougher from 1 January 2024. These rules, if implemented, could see the application of tariffs on electric vehicles traded across the Channel in both directions, risking electric vehicle production and sales in both the UK and EU. With mere weeks remaining to find a solution, the industry is once again urging all parties to delay their introduction until 2027, a pragmatic solution to allow time for the pan European battery supply chain to ramp up production.”

Mike Hawes, SMMT Chief Executive, said: “These figures, coming on the back of a series of significant investment announcements, signpost a bright 2024 for the UK automotive sector. Government and industry are committing billions to transform the industry for a decarbonised future. Last week’s publication of an Advanced Manufacturing Plan and Battery Strategy, the announcement of permanent full expensing in the Chancellor’s Autumn Statement and the £2bn commitment Government has made to advanced automotive manufacturing, underscore the increasing competitiveness of the UK. Automotive remains one of the country’s most critical industries, delivering jobs, productivity and economic growth across the country.”