UK car manufacturing down 19.2% in first half of 2022

UK car manufacturing fell 19.2 per cent in the first half of 2022, with 403,131 vehicles rolling off production lines.

The decline was driven in part by the global semiconductor shortage, which the Society of Motor Manufacturers and Traders (SMMT) says isn’t receding as quickly as expected back in January.

June 2022 was the second consecutive month of growth, however, with production up 5.6 per cent year-on-year. The SMMT anticipates that supply issues will ease in the next six to 12 months, but expects they will still be a factor in 2023 and 2024.

Falling export volumes are also playing a role – 23.9 per cent fewer cars were produced for overseas markets during the first half of 2022 than in H1 of 2021.

Mike Hawes, chief executive of the SMMT, said: “Car manufacturers have been suffering from a ‘long Covid’ for much of 2022, as global component shortages undermine production and put supply chains under extreme pressure.

“Key model changeovers and the closure of a major plant last year have also impacted output, but there are grounds for optimism with rising output over the last two months. As these issues recede over the next year or two, investment in new technologies and processes will be essential but this will depend on our underlying competitiveness.

“Sky-high energy costs, non-competitive business rates and skills shortages must all be addressed if we are to build on our inherent strengths and seize the opportunities presented by the dash for decarbonised mobility.”

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