UK vehicle production experienced a drop of 17.7% in January, with a total output of 78,012 units, according to the Society of Motor Manufacturers and Traders (SMMT).
This decline is attributed to weakness in key markets, including the EU, China, and the UK, coupled with planned model changeovers affecting production schedules.
Production of battery electric, plug-in hybrid, and hybrid vehicles rose by 1.5% to 30,028 units, representing 42.2% of all cars manufactured last month.
Despite this increase, overall car production for export fell by 9.2% to 57,140 units while production for the UK market decreased by 30.4% to 13,964 units.
The EU remained the largest market for British-built cars, accounting for 52% of exports, followed by the US at 18.6%, China at 6.2%, Turkey at 3.5%, and Japan at 3.4%.
Although exports to the EU and China decreased by 11.2% and 46.3% respectively, shipments to the US, Turkey, and Japan increased by 12.4%, 36.9%, and 8.1%.
Commercial vehicle (CV) production was also driven by export demand, with 61.7% of UK van, truck, taxi, bus, and coach production destined for overseas markets.
However, exports saw a year-on-year decline of 46.6%, with 97.1% of these vehicles shipped to the EU. Domestic CV production fell by 31.1% to 2,649 units.
The SMMT said the automotive sector is navigating plant restructuring and a slower rollout of new models in response to softening demand.
The trade body added that the industry is urging the government to prioritise the automotive sector in its upcoming industrial and trade strategies to support the domestic market and the rollout of electric vehicles.
The quick release of the £2bn promised by the government through the Automotive Transformation Fund is seen as crucial to enhancing the competitiveness of the UK’s automotive sector.
This sector has the potential to contribute £50bn to UK growth over the next decade, underscoring the need for strategic support.
SMMT chief executive Mike Hawes said: “UK vehicle producers face a perfect storm of global trade uncertainty, challenging manufacturing conditions and a market transition which is proving tougher than expected.
“The sector is doing all it can to keep production plans on track but needs government to ensure automotive is at the heart of its forthcoming industrial and trade strategies with promised funding invested as soon as possible.
“Doing so will help ensure our competitiveness and safeguard the billions of pounds of investment, jobs and economic growth which is now at stake.”
According to the latest report from the European Automobile Manufacturers’ Association, new car registrations in the EU declined by 2.6% in January 2025 compared to the same month in the previous year.
“UK vehicle production faces global challenges amid declining output” was originally created and published by Motor Finance Online, a GlobalData owned brand.
The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
