Society of Motor Manufacturers and Traders calls on government to support industry
Car factories across the UK are manufacturing their lowest number of vehicles since the Suez crisis back in 1956.
A mere 53,000 vehicles were made in July, a drop of 37% compared to the same month in 2020, when the UK was emerging from the first pandemic-induced lockdown.
Factors causing the slowdown include the ‘pingdemic‘, a worldwide shortage of microchips and traditional summer holiday shutdowns at car plants.
Overall production levels are up for 2021 by 18.3% year-on-year, while compared to 2019, before the pandemic, the numbers are down by 28.7%.
As a result of poor performance, and the impact of Covid, the Society of Motor Manufacturers and Traders (SMMT) has downgraded its production forecast for 2021, cutting it by 55,000 to 950,000.
The SMMT suggested that the UK Government should intervene to offer assistance to the industry.
“These figures lay bare the extremely tough conditions UK car manufacturers continue to face,” Mike Hawes, chief executive of the SMMT, said. “While the impact of the pingdemic will lessen as self-isolation rules change, the worldwide shortage of semiconductors shows little sign of abating.”
There is a worldwide shortage of computer chips for cars as production moved during the pandemic to meet demand for consumer electronic goods. The average new car needs 1,500 microchips.
Some companies, including Toyota are closing down production at their factories for a temporary period of time.
SMMT numbers suggest that the UK’s car industry accounts for 13% of exports.
“Government can help by continuing the Covid measures in place and boosting our competitiveness, with a reduction in energy levies and business rates for a sector strategically important in delivering net zero,” Hawes said.
