UK Car Production Hits 43-Year Low Amid Industry Challenges
UK car production has fallen for the ninth straight month, marking the worst November since 1980, according to figures from the Society of Motor Manufacturers and Traders (SMMT). Last month, 64,216 vehicles were produced—a 30% drop from the same period last year. Factors behind the decline include strategic shifts toward electric vehicle (EV) production, weak consumer demand, and challenging global market conditions.
EV Transition Drives Factory Retooling
The push to transition from internal combustion engine (ICE) vehicles to EVs has led to significant changes at many UK plants, with retooling efforts for EV production resulting in temporary disruptions. Despite this, nearly a third of the vehicles produced in November were electrified models, such as battery electric, plug-in hybrid, and hybrid vehicles. However, these volumes are still down 45.5% from last year due to model switchovers.
Domestic and Export Markets Shrink
Domestic car production fell by 56.7%, while export output dropped 21.3%. More than half of the exported vehicles went to the EU, underscoring the importance of this market to UK manufacturers. The overall decline in production reflects not just domestic challenges but also a lack of consumer confidence and subdued demand across Europe.
EV Mandate Sparks Debate
Adding to the pressure is the UK’s EV mandate, which requires zero-emission vehicles to make up 22% of sales this year, increasing to 80% by 2030. While November’s EV sales exceeded expectations, automakers have criticized the mandate, citing high production costs and insufficient consumer demand. The SMMT estimates the policy could cost the sector £5.8 billion, with industry leaders urging the government to revise the regulation.
Broader Industry Woes
The challenges in the UK are part of a global trend. High raw material costs, rising borrowing rates, and competition from Chinese imports have hit automakers worldwide. In recent months, major companies like Volkswagen and Bosch have announced factory closures and job cuts, with thousands of positions lost across Europe.
SMMT Chief Executive Mike Hawes stressed the need for urgent government intervention, including incentives for EV buyers, infrastructure expansion, and a comprehensive industrial strategy. "These figures offer little Christmas cheer for the sector," said Hawes. "Government can help by supporting consumers in the transition, fast-tracking its Industrial Strategy, and reviewing market regulations that are putting enormous strain on the sector."
