‘Cliff edge’ Brexit threat

UK car manufacturing output fell by 11 per cent in July compared to the same month last year new figures show – as Brexit uncertainty continues to plague the automotive sector.

The latest Society of Motor Manufacturers and Traders (SMMT) figures show around 121,000 cars were built in July – down from 136,000 last year and with a 35 per cent drop in cars built for the UK market – prompting Unite to warn of worse to come if the government does not avoid a cliff edge Brexit.

Investment in the automotive sector fell by 50 per cent in the first six months of 2018, while in July car production for export dropped by 4.2 per cent, although the SMMT said the sector remains roughly on course to hit expectations for the year.

A range of factors contributed to the fall in output in July, including model changes, adjustments for stricter emission standards and operational adaptations, the SMMT said.

However SMMT chief executive Mike Hawes was clear that “domestic uncertainty” also played a part and that the industry needs “political and economic clarity” if things are to improve.

He said, “While the industry is undoubtedly feeling the effects of recent uncertainty in the domestic market, drawing long-term conclusions from monthly snapshots requires a health warning.

“The bigger picture is complex and month by month fluctuations are inevitable as manufacturers manage product cycles, operational changes and the delicate balance of supply and demand from market to market.

“To ensure future growth, we need political and economic clarity at home, and the continuation of beneficial trading arrangements with the EU and other key markets.”

Unite assistant general secretary Tony Burke said the figures “once again” underline the critical need for Theresa May to avoid a cliff edge Brexit.

He said, “The UK’s car workers and those in the supply chain have worked tirelessly to make Britain’s car industry a global leader.

“With government confusion over diesel continuing to take its toil it would be a betrayal if a jewel in the crown of UK manufacturing was sacrificed on the altar of a hard Brexit.

“Car workers and their families demand certainty for the future and a Brexit deal that secures tariff free access to a customs union so that the British car industry can continue to go from strength to strength.”