Vehicle output drops slightly in February but export volumes rise
CAR output slipped back below 2013 levels in February although encouragingly, the number of vehicles for export rose.
Overall production was down 2.7% in February to 133,730 units (2013: 137,458). For 2014 to-date, production volumes are down 1.4% at 262,645 units.
Export volumes were up 3.5% last month at 105,817 (2013: 102,207). For the first two months of 2014, the overall export figure is up 2.4%. Almost 80% of vehicles manufactured in the UK last month were destined for overseas markets.
The Society of Motor Manufacturers and Traders said it estimated the average car export value had risen more than 70% between 2007 and 2013, to over £20,000.
It has forecast the UK industry will continue to see growth in 2014 and beyond, as fresh investments are made and new models come to the market.
Mike Hawes, SMMT chief executive, said: “UK car manufacturing has been broadly stable over the first two months of 2014, dipping only marginally due to forecast product cycle changes.
“The significant increase in the value of car exports in recent years reflects the changing profile of the models produced and underlines the sector’s economic importance. With the effects of recent investments still to be fully realised, industry looks forward to providing an even greater contribution to the UK economy in the future.”
The society said it had also been encouraged by what measures the Chancellor had introduced in his latest Budget.
It said the measures to support UK manufacturing as part of a balanced industrial strategy were important in helping to encourage investment and exports.
“The Chancellor’s focus on investment, exports and skills, as well as reducing energy costs for manufacturing, is welcomed by the automotive industry,” said Hawes.
“Extending and doubling the Annual Investment Allowance and improving export finance are important signals to encourage the UK’s manufacturing base, helping trigger greater business investment and enhancing our export capability.
“In line with welcome reductions in energy costs, we ask government to look at business rates to ensure the system works for manufacturing and maintain our global competitiveness.”
He said measures to extend incentives for ultra-low emission vehicles (ULEVs) under the company car tax regime were also welcome.
“Industry needs clear direction from government on how its £500m commitment to develop the ultra-low carbon vehicle sector between 2015-2020 will be allocated,” added Hawes.
