Slight dip in car manufacturing in May, but market remains positive

JonathanJune 28, 2013

A slight dip in car manufacturing was witnessed during May 2013, it has been reported. Figures published by the Society of Motor Manufacturers and Traders (SMMT) highlight an 8.4 per cent reduction in vehicle production to 129,355 units.

The body said output has remained flat during the first five months of 2013, falling just 0.6 per cent to 632,804 units. And despite the 8.4 per cent drop last month, vehicle production – including lease cars – remains above pre-recession levels.

According to the SMMT, demand continues to increase in the domestic market, fuelling production rises of more than a quarter so far in 2013. However, the society said weak demand in European markets has curbed overall car output.

“Despite output falling this month due to weak European demand, UK car manufacturing in May was above 2007 levels,” said Mike Baunton, interim chief executive at the SMMT. “Production levels are holding firm for the year so far, testament to the appeal of UK-built products around the world and significant growth in volumes built for the home market.”

Mr Baunton warned that economic challenges abroad will impact on car output in the short-term, but said high-value investment by global automotive companies has put the UK industry on course for “prosperity in the long-term”.

In the commercial vehicle sector, the SMMT reported that output fell by 20 per cent to 7,560 units in May 2013. The society said this decline was broadly in line with the 16.1 per cent fall seen during the year-to-date. Output for the home market showed further growth, it claimed, however this could not offset export losses, with volumes down almost a third in the month.

“Commercial vehicle manufacturers continue to battle against weak demand, particularly abroad, with output sliding 20 per cent in May,” commented Nigel Base, commercial vehicle manager at SMMT. “Demand for UK-built commercial vehicles in the home market grew moderately, but this was not enough to lessen the significant drop in export volumes.”

He said 2013 is going to be “a hard year” for the UK’s commercial vehicle manufacturers but there are “pockets of positivity”. Mr Base noted that some areas of the industry are experiencing growth as operators take advantage of the wide range of vehicles built in the UK.

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