Production rose 11.7% in the first half of the year, the SMMT said today (27 July), reaching a total of 450,168 vehicles – more than a third (37.8%) of which were battery electric vehicles (BEVs) or hybrids.
Manufacturers were increasingly able to manage global supply chain challenges that have constrained production since the start of the pandemic, the organisation said, notably the shortage of semiconductors.
The news comes a week after Tata Motors’ announcement of a massive new ‘gigafactory’ for the UK, helping anchor EV production for Jaguar Land Rover, one of Britain’s biggest carmakers.
Growth in the first half of the year was driven by exports, which surged 13.6% to 359,940 vehicles, roughly eight-in-10 of those made. Volumes for the UK were up too, rising 4.5% to 90,228 units.
Year-to-date output remains 32.5% below 2019 levels, however. This reflects “structural changes in the sector”, the SMMT said, but also shows the available opportunity for UK carmakers “if a globally competitive business investment environment can be assured”.
“Free and fair global trade – especially of the latest, zero-emission electric vehicles – is essential. The European Union (EU) remains the UK’s largest export market, accounting for 59.5% of all British car shipments, up 11.2% to 214,017 units,” the announcement said.
“The EU is also the largest source of imported vehicles, so safeguarding this important bilateral trading relationship is essential for both sides, hence the need for a quick and positive outcome to discussions on forthcoming changes to the rules of origin requirements for electrified vehicles and components.”
Some of the other key overseas markets are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to which the UK is now a party. Those members have taken a cumulative 9.6% of UK car exports so far this year.
The capacity of UK carmakers to turn out the latest, greenest models has also increased, with production of hybrid electric (HEV), plug-in hybrid (PHEV) and BEVs up 71.6% from January to June, to a record total of 170,231 units.
“UK car manufacturing is growing again, with production – especially of electrified models – increasing and major investment announcements making headlines,” said Mike Hawes, SMMT chief executive.
“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.”
The sector supports about 800,000 jobs in total, the SMMT said, including manufacturing, retail and aftermarket. 208,000 workers in manufacturing achieve annual turnover of £78bn, adding £16bn to the UK economy and investing about £3bn in R&D every year.
Recent investment announcements bode well for the future of the sector, the organisation said, but it claimed “sustained growth requires more and continued investment”. A recent SMMT report, Manifesto 2030: Automotive growth for a zero emission future, set out five key pledges and policy actions to drive growth and deliver net zero.
The plan called for all political parties to commit to attract more global investment; to support 'upskilling' workers as they transition from making engines to batteries; to boost global trade; to provide affordable, sustainable energy; and to drive a “vibrant” electric vehicle market with world-class charging infrastructure, incentives and choice.
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