31 May 2016

UK Net Car Importer In 2015

Bentley is small in numbers but big in value added

I'm not taking sides with the Brexit issue, nor do I claim (unlike some 'experts') to know how UK's exit from the EU would affect the UK if it goes ahead. However, the SMMT (which represents the British car industry and importers) is most anxious that the UK stay within the EU. The reason is to protect British car manufacturing. I don't get the logic and I will explain why.

If it exits, Britain may face an import duty of 10% selling cars in Europe. I assume that would apply both ways. The UK imports more cars from Europe than exports there, by some margin. So exports to Europe would be reduced and imports from Europe likewise. It doesn't take a rocket scientist to work out Europe has more to lose by tariffs, especially Germany.

What it means:  European car manufacturers do very well out of the UK, notably Germany and Spain.

Moving on from that subject I have gone back to 1981, comparing how many cars are made in the UK against how many are sold there. In 2015, the UK made nearly 1.6 million cars and bought over 2.6 million. That's a deficit of nearly 1.05 million or -39.7%. That is the second lowest percentage since 1989.

The chart below is in thousands, so three zeros have to be added to each figure. It shows the car companies that assemble in the UK and whether they export more than they import. For example Nissan produced 475,000 cars and sold 154,000 in the UK, making it a net exporter of 321,000 cars. If a car brand isn't there, then they don't make cars in Britain. Either that or they are too small to be counted, such as Aston Martin, Lotus, Morgan etc. (Those other small makes add up to 17,000 cars, as seen in the 'Rest' column).

Summary: Comparing 2014 and 2015, UK car sales grew faster than UK production by nearly 100,000 cars compared to the previous year. That took the deficit figure from 951,000 to 1,046,000. 2016 should see the sales increase slowing or even plateau, while car manufacturing will increase quite strongly. Britain will never again be a country that makes more cars than it buys, but not that many nations are in that position. The value to the UK economy car manufacturing brings is still very substantial.

Year 2014 2015

Brand Prod Sales +/- Prod Sales +/-

Nissan 500 138 362 475 154 321

Land Rover 373 56 317 387 67 320

Mini 179 54 125 201 64 137

Toyota 172 94 78 190 99 91

Honda 122 54 68 103 24 79

Jaguar 76 18 58 119 53 66

Bentley 11 1 10 11 1 10

Vauxhall 78 269 -191 85 270 -185

Rest 14 1792 -1778 17 1902 -1885

Total 1525 2476 -951 1588 2634 -1046

Net Importer



Data source: SMMT.

The Jaguar F-Pace will be part of the 2016 figures


  1. The logic of the reasoning is fundamentally flawed.

    With a Brexit, it is unlikely that JLR group would have a better market opportunities, and could eat up the majority of European brands UK market shares. Given the eventual doom and gloom, a rise in percentages perhaps...
    It is very probable however, that the car market would not grow in the next 5 years :)...

    At the same time the majority of the UK car production is destined for the EU market. I would be far more worried about that.

  2. ...and Britain would still sell many cars in Europe. The point is far more cars flow into the UK from Europe than the other way. Both flows would suffer but Europe has more volume to lose.
    The UK would also negotiate trade deals elsewhere so how that would go would be important as well. Like I said it is virtually impossible to know either way for certain, but the SMMT has too much vested interest with European car brands to give an objective opinion. I'm not into politics so I don't want it to sound it concerns me either way.

  3. This is an assumption that the numbers would equally change.

    Why would EU lose more volume?

    1. UK cars can not replace import cars in all segments.

    2. The UK production is not there for the UK market only, but for the EU market. If the trade relations suffer and the devaluating pound would not compensate, the Nissan production could inevitably be relocated (at least for the left hand models). Some might see an opportunity, but wonder if that is enough.

    3. I note from the NL sales, that the Dutch remained faithful to Volvo and Mitsubishi long after they wound down Nedcar.

  4. The assumption is based on the fact that many cars made in the UK are higher ticket models, therefore less affected by a tax imposed. Those from Europe are smaller mainstream cars and any tax on them will be felt.

    I'm sure car manufacturers would look at future model planning for the UK differently than they do now, if things changed. However, I am convinced that the UK isn't going anywhere; people don't want uncertainty. I just commented on scaremongering from those with vested interests. The fact is no one knows for certain what would happen.

  5. This analysis ignores two salient points
    1) we'll still need cars after Brexit AND
    2) UK car manufacturing is reliant on EU supply chains, and EU exports. If there are any form of trade barriers, these manufacturing plants will close, with manufacturing moved into the EU.

    Point 2 is already happening. We'll lose most of the car manufacturing we do have, so exports will fall, but imports will have to rise as we'll no longer have some UK consumers buying British cars - a double whammy if you will.

    This won't just affect those employed directly - it will affect those who work for UK suppliers to the EU and UK car manufacturing, and those who benefit indirectly (service industries supported by those workers). The net loss to the UK economy will be huge, and ironically centered in many areas that voted leave.

    1. Wow, do you think I didn't know the UK will still need cars in the future?

      The UK car manufacturing relies mainly on Nissan (not a company in good shape at the moment, regardless of outside forces) and JLR, who will continue to manufacture locally. Toyota have only closed one factory in its history, when car manufacturing ceased in Australia. I don't see them closing Burnaston. Honda has already given up on Europe due to low demand and both the UK and Turkey will lose plants shortly. The other larger plants are with PSA (Ellesmere Port and Astra, which is at risk constantly with the over capacity Opel/Vauxhall has and Luton, where PSA has committed to production for years to come with a new van).

      What the British fail miserably in is giving support for its car industry. That's its biggest risk factor, having to export virtually everything because apathetic and selfish UK citizens are only interested in bending their arm at the local, then give rabid support to their local football team. If a fraction of that football loyalty was delivered in buying locally made....