Amid a downgrading of UK’s forecast car and light van production the Society of Motor Manufacturers and Traders has warned the Government of “devastating” risks from lower vehicle output.
Its expectations suggests the UK assembly plants, which include Nissan’s Sunderland factory, Toyota’s Burnaston plant and Stellantis facilities at Luton and Ellesmere Port, will produce 911,000 vehicles this year, and just 839,000 in 2025, around a third less than the almost 1.4 million cars and light vans made five years ago in the last pre-pandemic year.
If the OEM’s planned UK zero emission model launches stay on track, and crucially consumer demand for electric vehicles (EVs) improves, the Society of Motor Manufacturers and Traders (SMMT) believes that there is potential to get above one million units in 2028.
If not, the SMMT predicts that output will remain below one million units until 2030, and could drop to fewer than 750,000 in a worst-case scenario should OEMs reduce their model lineups and close factories
This, it says, would have a devastating effect on the sector, jobs and economic growth.
The analysis follows a series of announcements by manufacturers and suppliers, in the UK and Europe, reflecting challenging market conditions and a slowdown in the transition to electrification.
Ford announced it is cutting 800 UK jobs over the next three years, with 4,000 roles being lost across Europe, due to weak demand for EVs.
Stellantis has said it will close its Luton factory, which makes vans for its Vauxhall, Citroen, Peugeot and Fiat brands, and consolidate its electric van production into its Ellesmere Port plant. In 2022 it had said Luton would commence electric van production in 2025.
The Government says it will launch a ‘fast track’ consultation on EV sales targets in the ZEV mandate after mounting pressure from the auto industry.
Mike Hawes, SMMT chief executive, said: “These are deeply concerning times for the automotive industry, with massive investments in plants and new zero emission products under intense pressure.
“Slowdowns in the global market – especially for EVs – are impacting production output, with the situation in the UK particularly acute given we have arguably the toughest targets and most accelerated timeline but without the consumer incentives necessary to drive demand.
“The cost of stimulating that demand and complying with those targets is huge and, as we are seeing, unsustainable.
“Urgent action is therefore needed, and we will work with Government on its rapid review of the regulation and the development of an ambitious and comprehensive Industrial Strategy to assure our competitiveness.”
UK car manufacturing output fell 15.3% in October, the eighth consecutive month of decline, according to the latest figures SMMT.
Some 77,484 units left UK factories, 14,037 fewer than in the same month last year, with plants continuing their retooling to enable production of the next generation of zero emission vehicles.