Britain’s car exports to the world rose 6% in June – as production for the home market dived by almost half
Britain’s car exports to the world rose 6 per cent in June, as the UK automotive industry attempts to spread its trading wings in the run up to Brexit
Some 113,152 British-built cars were destined for global markets at the rate of nearly 4,000 every day during June, according to official Society of Motor Manufacturers and Traders.
In demand: Half built Minis come spinning down the state-of-the-art production line in Cowley. Britain’s car exports to the world rose 6 per cent in June
The export market’s performance is a major help to UK car makers, as production for the domestic market plummeted – down by 47.2 per cent in June.
Car makers said the domestic nosedive was an anomaly, due to model changes and preparations for new real world emissions testing, while eight out of ten cars produced in the UK are exported.
In the first six months of 2018 a total of 834,402 cars were built in Britain of which 675,187 (80.9 per cent) were exported.
Exports to the US – the UK’s second largest export market – rose by 1.5 per cent to 108,307 vehicles from January to the end of June.
Those to Japan were up 77.3 per cent and to South Korea they were up 67.8 per cent.
By contrast, exports to the European Union mainland fell by 3.6 per cent.
However, the potential headache that Brexit poses to Britain’s car industry is highlighted by the EU being Britain’s biggest trading partner, accounting for 53 per cent of cars produced for export.
The US accounts for 16 per cent, with China in third place at 6.4 per cent, followed by Japan at 3.3 per cent, Turkey at 3 per cent and South Korea at 2.2 per cent.
The export market’s performance is helping car makers out, as there has been a big decline in production for the domestic UK market – down by 47.2 per cent in June.
Some 113,152 British-built cars were destined for global markets at the rate of nearly 4,000 every day during June
But car makers insisted it was a blip and ‘an anomaly’ and blamed it on a ‘perfect storm’ of events including model cycle changes, operational changes, and preparations for a new range of next generation vehicle technology ahead of new ‘real world’ WLTP emissions standards and the demonization of diesel.
Motor industry bosses said ‘strong exports’ had helped counter ‘disappointing domestic demand’ as UK car manufacturing overall fell by a ‘moderate’ 3.3 per cent in the first half of 2018.
It also helped bolster motor output for the month of June which dropped -5.5% overall with 128,799 cars rolling off production lines.
The figures were released as the SMMT said it believed a Brexit deal would go ‘to the wire’ next spring and that car-makers are preparing contingency plans to keep UK production lines running in the increasingly likely event of a ‘hard Brexit’.
It also insisted that sounding the death of diesel was ‘premature’ but that action by politicians had ‘sowed the seeds of confusion’ that had hastened its demise by unfairly denting consumer confidence.
The SMMT reiterated calls for Brexit negotiators on both sides to back free and frictionless trade to safeguard one of the UK and EU’s most valuable assets.
The SMMT report concluded: ‘While exports grew 6 per cent in the month, this couldn’t offset a 47.2% decline in production for the UK.
‘Production for export has continued to drive volumes throughout 2018, with overseas orders broadly stable, down by a marginal 0.8 per cent in the first six months.’
It added: ‘In the year to June, global demand for British-built cars grew in a number of key markets, notably the US – the UK’s second largest exports destination after the EU – where exports rose by 1.5% thanks to a raft of new, desirable models.’
The SMMT added that in the year to date, 675,187 cars have been built for global markets ‘helping to mitigate disappointing domestic demand’ with overall output down by just 3.3 per cent to 834,402 units.
Individually, EU countries made up half of the UK’s top 10 export destinations, with Germany, Italy and France the UK’s second, third and fourth biggest markets after the US and ahead of China.
The SMMT report noted: ‘Although UK Automotive now exports more than eight out of every 10 cars it builds to more than 160 countries worldwide, it is also a major importer’.
More than 87 per cent of the cars registered by British buyers in the first six months of the year came from overseas plants, and more than two thirds (69.1 per cent) from the EU.
This it said emphasised ‘the importance of tariff- and barrier-free trade’.
SMMT chief executive Mike Hawes said: ‘June’s results demonstrate the risks of judging automotive performance one month in isolation, with numerous and varied factors creating a perfect storm for home market output.
‘Looking at the longer-term picture, the sector is performing as expected in the context of market conditions at home and abroad. ‘
Mr Hawes added: ‘First half figures are a reminder of the exports-led nature of UK Automotive, the integrated EU supply chain and our mutual dependency on free and frictionless trade.
‘The UK government’s latest Brexit proposals are a step in the right direction to safeguard future growth, jobs and consumer choice – not just in Britain but right across Europe.
‘We now look to negotiators on both sides to recognise the needs of the whole European automotive industry which, combined, employs more than 12 million people. Any disruption risks undermining one of our most valuable shared economic assets.’
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