Latest stats show dip in Motor Trade resurgence
There is now clear evidence that Brexit has left the UK motor industry in a difficult position with regard to long-term business planning and scheduling new product developments.
Figures recently announced clearly show that there has been a substantial dip in the amount of money invested in motor manufacturing in the UK in the first half of this year.
If it continues at this level, the total amount invested in the motor industry in the UK in 2017 could add up to less than half of the figure for 2016.
It’s the second consecutive year that the UK car industry has seen investment drop, but according to the Society of Motor Manufacturers and Traders, the first half of 2017 has seen a particularly steep decline.
The view is that car manufacturers and companies supplying this sector are delaying – or in some cases cancelling – non-essential development projects.
They are waiting to see the effects Brexit has before committing to new projects in the UK. Though this was expected to some degree, the relative fall in investment has shocked some pundits, particularly as the UK motor industry has been enjoying a resurgence in recent years.
2016 was the 7th consecutive year that car manufacturing grew, and there were also improvements in productivity, production output and sales.
This is illustrated by the fact that there were 1.7m vehicles made in the UK in 2016. However, according to the figures from the Society of Motor Manufacturers and Traders, by May 2017 this had dropped by 10% compared to the same period in the previous year.
SMMT chief executive Mike Hawes is quoted as saying: “for UK auto manufacturing to continue to thrive, we need clarity on the future, post-Brexit, to encourage ongoing investment and growth.”
The issue was also succinctly summed up by BMW when it announced it was manufacturing the new electric Mini elsewhere. A company statement said Brexit “creates uncertainty for the automotive sector in general and for overseas investors in particular”.
There has been some good news for the sector recently though. Toyota has spent £240m on installing new equipment at its Burnaston plant in Derbyshire.
One of the biggest trends revealed by the latest research by the SMMT shows that the UK is focusing substantial investment in developing low-emission technology.