31 July 2017

UK Vehicle & Engine Production : Jan - Jun 2017

Engine plant, Wolverhampton, U.K.
The SMMT in the U.K. has released half year figures for production of the vehicle industry. So first up the hard facts:

Car:
Domestic 183,000 -9.5%.
Export 684,000 -1%.
Total 867,000 -3%.

CV:
Domestic 16,000 -30%.
Export 28,000 +12%.
Total 44,000 -8%.

Total Vehicle: Domestic 199,000. Export 711,000. Total 910,000 -3%.

Engine: Domestic 609,000. Export 801,000. Total 1,410,000. +4%.

What to make of it: 2017 was supposed to be a better year for U.K. production but predictions were overly optimistic. Any growth this year will be good. The U.K. market is coming off a prolonged buying boom which has ended. The U.S. market is in a similar situation. However, engine volumes are holding up well, probably due to JLR.

As to how U.K. manufacturers are faring, that's impossible to tell as there is no breakdown available. I assume of the main producers JLR is about the same as last year, Nissan down slightly as G.M. is probably too. Car production is subject to cyclical swings anyway.

What is good about the timing of this slowdown is that it comes prior to any political issues and decisions that would erroneously be used as a reason. The reality is that many who report on such matters twist the truth to suit their agenda, but that can't do that in this instance. We really have to inform ourselves and use discernment to know what's going on, because few sources of information are free from bias and self interest.

My prediction: U.K. vehicle production will be up slightly this year but future growth will challenging and largely dependant on consumer demand. Brexit will have little or no effect despite what you may hear to the contrary.

The U.K. publc will continue to ignore the domestic car industry - with the same blissful ignorance that it has shown for years - and care not a jot about the benefits it provides to the nation. Therefore exports will continue to underpin the industry, increasingly outside of Europe.

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