UK car manufacturing heads for six-year high

Car production rose 4.5 per cent to 1.42 million units in the first 11 months of the year, according to the Society of Motor Manufacturers and Traders (SMMT), driven by new models coming onto the market such as the third-generation Mini.

A 3.6 percent fall in output in November compared with the same month a year ago was due to some manufacturers preparing production lines for more new models, which will boost production in 2014.

This year’s overall rise was helped by a 24.2 per cent jump in demand from the domestic market to 293,292 vehicles.

New car sales in Britain have soared as the economy recovers and as distributors offer attractive financing deals. Demand for new fuel-efficient models has also helped sales. The SMMT expects annual car output in Britain to hit 2 million by 2017.

Earlier this month the SMMT said the number of new cars registered in Britain had soared 7 per cent in November, the month’s highest increase since 2004, representing 20 consecutive months of rises in car sales. Registrations are up 9.9 per cent so far this year and SMMT forecasts them to hit 2.25m for 2013 as a whole. Sales abroad have grown just 0.3 per cent this year, however, thanks to the slower economic recovery in Europe, which buys up half of Britain’s car exports, although the outlook there may be improving.

“We think the euro zone is turning a corner, because we’ve had three consecutive months of growth in their registrations,” the spokesman said.

In contrast to the demand for cars, commercial vehicle manufacturing has slumped this year, mainly due to ongoing weak demand from Europe, with production falling 21.5 per cent to 82,535 units. November saw a 35.7 per cent drop, the SMMT said.

Engine manufacturing increased for a third consecutive month, up 3.4 per cent to 231,371 in November and 2.5 per cent across the year, helped by firm demand at home and abroad.

The British automotive industry accounts for 10 per cent of total exports and has an annual turnover of £59bn.