The latest car and van production figures out this week show an auto industry finally getting back on track after the tough Covid years, helping meet pent-up consumer demand as manufacturers were increasingly able to manage global supply chain challenges – notably the shortage of semiconductors.
Car production grew 11.7% in the first six months, the best first half total since 2021, as nearly half a million units rolled off manufacturing lines, with June completing five months of consecutive growth. Commercial vehicle production also proved a bright spot, demonstrating a strong performance as output grew 16.0% to mark the best first half in over a decade and the best June since 2008.
The positive news was not just limited to the total output but also the types of vehicles we are producing, with electrified vehicle production surging by 71.6% to a new first half record. 170,231 battery electric (BEV), plug in hybrid (PHEV) and hybrid electric (HEV) vehicles have left factory gates since January, representing a third of all cars produced so far this year – good news given the importance of these vehicles to the sector and wider society in reaching net zero.
With the milestone news last week that the UK is to host one of the largest battery cell gigafactories in Europe, it is reassuring to see that industry is able to attract much needed global investment to power the electric transition. Testament to the inherent advantages of making cars, and green ones at that, in Britain – a result of our highly skilled and productive workforce, world class R&D and efficient, productive plants.
We look set to see further growth throughout the year, as the independent Production Outlook forecasts UK car production to reach around 860,000 units in 2023 – an uplift of 10.9% on 2022 – with light CV production expected to grow even more, by 44.0% with additional capacity due to come on line.
This is momentum on which we must continue to build, especially if we are to meet our ambitious decarbonisation goals. One of the biggest barriers remains high energy costs so measures must be introduced to ensure they are more competitive – not just for vehicle production but across the wider EV supply chain – as they are fundamental to our competitiveness. Together, with a concerted campaign to promote the UK’s unique automotive offering, it will allow us to compete at the forefront of the global stage.
Our next event, SMMT Electrified 2023, will also shine a light on the importance of electrifying the supply chain and the collaboration needed for the UK to succeed. Taking place on 18 September, the annual event will host experts from across automotive and associated industries, as well as speakers from government, who will discuss the UK’s path to net zero.
There are limited places available and SMMT members are eligible for one complimentary ticket per organisation. For more information and to book your place, please contact electrified@smmt.co.uk.
