The UK automotive industry is expected to break manufacturing records by the end of the decade, a new forecast report launched by the Society of Motor Manufacturers and Traders (SMMT) suggests.
Annual car production is expected to pass the two million mark by 2020, which would break the current record of 1.92m cars set in 1972.
In 2014, more than 1.5m cars were built in the UK, and as OEMs plan to accelerate production volumes and productivity over the next few years, the UK should consolidate its position as the third-largest car manufacturer in Europe – behind Germany and Spain, but ahead of France and a strengthening Eastern Europe.
As OEMs attempt to localise production further throughout the supply chain, it is expected that up to 28,000 jobs at suppliers could come available as the demand for British components increases.
The ‘shift to premium’ is cited as key to the UK’s manufacturing success. In 2010, 37% of UK car production was by premium manufacturers, and that is predicted to rise to 54% by 2020. This reflects the global trend for premium vehicles. The UK is Europe’s second-highest producer of premium cars, second only to Germany.
The report shows that since the recession in 2008, the UK automotive industry has seen plenty of investment, with £2 billion invested to-date in 2015 alone.
Year-to-date car production also passed the 1m unit mark in September, the country’s best annual performance since the recession.
Global market conditions and further investment could of course affect the prospects for the UK automotive sector, but things are looking positive. Mike Hawes, SMMT chief executive said, “This report is further proof of the growing stature of the UK as a global destination for high quality vehicle manufacture. The automotive industry has made tremendous strides in recent years, as significant investment, along with partnership and government, has drive huge growth in production employment.
“The prospect of further jobs growth, particularly in the supply chain, is extremely encouraging, while the UK’s consolidation as a global hub for premium production is testament to our prowess in design and precision engineering… Future growth in a fiercely competitive global market will rely upon continued government support, as well as an attractive business environment which drives investment and stimulates innovation.”
