UK car production still at lowest levels since end of WWII

Jill Petzinger
Jill Petzinger, Germany Correspondent, Yahoo Finance UK
Thousands of unwanted new and used cars line up on June 09, 2020, at Thurleigh Airfield in Bedfordshire. Britain's economy slumped by 20.4% in April in the biggest monthly decline since records began as the coronavirus lockdown paralysed the country. Photo: Chris Gorman/Getty Images

Car production in the UK remained at a near-standstill in the month of May, with just 5,314 cars rolling off the production lines.

According to the latest data from the Society of Motor Manufacturers and Traders (SMMT), there was a 95.4% drop compared to the same month the year before, making it the worst May since 1946, the year after WWII ended.

May’s production figures show early that the industry is very slowly starting to reboot again — around two-thirds of UK plants have started production — after just 197 cars were produced in April.

Graphic: SMMT

In the first five months of the year, the UK’s car plants have produced some 324,000 cars, a nearly 42% drop from the same period in 2019. SMMT expects fewer than one million vehicles to be produced this year.

“May’s figures are yet more evidence of why the UK industry, like its global rivals, needs dedicated support to drive a successful restart,” said SMMT chief executive Mike Hawes. “Government assistance so far has been vital in keeping many businesses afloat, but the job isn’t done.”

“Measures to boost cashflow, including additional and tailored finance schemes, tax relief and business rates deferral would deliver immediate results when liquidity is most acute,” he added.

READ MORE: Coronavirus: UK car industry warns one in six jobs could be lost after pandemic

While plants have started running at reduced capacity again, showrooms in the UK were shut until 1 June, meaning nearly all the cars produced in May were exported to the EU, China, and the US.

SMMT’s latest member survey last week found that a third of the automotive industry workforce in the UK is still on furlough after coronavirus lockdowns.

It revealed that there have been more than 6,000 redundancies in the car industry in the month of June — and one in six jobs will remain at risk when the government’s furlough scheme ends in November.

Hawes is also warning that the UK automotive sector cannot afford a no-deal or “bare bones” Brexit deal, after being pulverised by the impact of the coronavirus pandemic.