Car production rises as exports make up for falling UK demand

Car production increased last month as rising exports made up for falling demand in the UK, new figures reveal.

Just over 157,000 cars rolled off production lines in October, 3.5% more than the same month last year, according to the Society of Motor Manufacturers and Traders (SMMT).

Exports were up by 5%, with more than 1.1m cars built for overseas markets so far this year, compared with a 2.9% fall in domestic demand.

Production for the UK car market has now fallen for nine months in a row, to 28,178 in October. The SMMT blamed lower business and consumer confidence and confusion over government policies towards diesel vehicles.

UK car sales have been declining since April and fell another 12% in October, with diesel transactions down nearly 30%.

More than four out of five UK-built cars were shipped abroad last month, the highest proportion this year, with most going to other European countries.

An independent forecast on how many cars will be built this year has been revised down from about 1.8m to 1.73m, said the SMMT.

Mike Hawes, the SMMT’s chief executive, said: “It’s encouraging to see positive growth in exports this month and a slight increase in overall output.

“Production for British consumers, however, has continued to fall as domestic demand for new cars decreased for the ninth month this year amid continued uncertainty over both Brexit and the government’s air quality plans.

“It’s important that confidence is restored to the new car market, as sales of the latest cleaner, greener cars not only address air quality concerns but speed up activity on factory lines across the UK. The latest independent UK forecast report is worrying news for the sector, predicting annual output which is, at best, static compared with last year.

“The industry needs stability and a clear roadmap for Brexit if we are to encourage investment and arrest the decline in both the market and business confidence.”

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