UK car production fell -20.1% to 68,790 units last month, said the Society of Motor Manufacturers and Traders.
It was the weakest January since 2009 and output was down 17,262 units against the same month last year, which itself was one of the worst Januarys on record when volumes were impacted by friction in the new post-Brexit trading arrangements, extended shutdowns and the pandemic.
Several factors conspired to drive year on year production down still further in January 2022. The sustained worldwide shortage of semiconductors was the most significant cause, exacerbated by the loss of volume arising from a major plant closure in July 2021 and production variations caused by the changeover of some popular models.
More positive, however, was the continued shift towards electrified vehicles, with zero emission battery electric vehicles now accounting for one in 11 cars made in the UK, as their production rose 37.6% to 6,326 units. Including plug-in hybrids and hybrids, electrified vehicles accounted for more than a quarter of output (27.4%, up from 25.4% in 2021).
Production for both overseas and domestic markets was down year on year, by -17.5% and -30.8% respectively, as exports accounted for more than eight in 10 cars made. The EU remained the largest destination for UK-made cars, taking 59.1% of exports, followed by China (10.4%) and the US (10.0%).
Mike Hawes, SMMT Chief Executive, said, “It’s another torrid start to the year as global supply issues and structural changes squeeze output while model changes impact production scheduling.
“The UK automotive manufacturing industry is, however, fundamentally strong and recent investment announcements are testament to the potential for growth, not least in terms of rising EV production. Long-term recovery can only be delivered, however, if global competitiveness is assured and for that we must address both inflationary and fixed costs, most obviously escalating energy prices, but also fiscal and trading costs.”
In contrast, commercial vehicle output started the year 22.2% up on the same time last year, mainly driven by export orders but there was also a 10.9% increase in UK registrations as the delivery economy expanded.