UK new car output: exports rise as domestic demand slumps

A rise in new car exports failed to stop UK car production dropping 2.1% year-on-year in January, making it the fifth successive month of decline for the industry. 

Latest figures from the SMMT reveal that 118,314 new cars were built in the UK last month, compared to 120,890 in the same period last year. 

Despite the drop in overall output, the number of cars built for export increased by 4.1% to 97,870, accounting for 82.7% of the UK’s total output. The SMMT attributes this uptick to rising demand in key Asian and European markets for new models from UK-based manufacturers. 

The rise in overseas demand was in contrast to a sharp drop in domestic production, which was down 23.9% to 20,444 units in light of “continuing weak confidence”, according to the organisation. This was the driving factor behind last month being the worst January for UK car production in nine years. 

SMMT Chief Executive Mike Hawes said: “Exports are the bedrock for UK car manufacturing so a rise in January exports is welcome following recent declining demand in overseas markets. These figures, however, still give great cause for concern, with another month of falling car production driven by a lack of confidence and corresponding weak demand in the UK.

“The upcoming Budget is an opportunity for the government to provide supportive measures to stimulate the market, but the biggest boost would be the agreement of an ambitious free trade deal with Europe.”