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The UK car industry is “back in the game” after securing £24bn of new investment commitments last year, the car industry body said on Thursday, more than in the previous seven years combined.
After years of spending cuts due to Brexit uncertainty and instability at the top of government, the auto sector is once again ‘investable’, with Nissan, Jaguar Land Rover, Tata and BMW among the also made a big announcement, the Automobile Manufacturers and Trade Association said.
UK car production has surpassed one million vehicles for the first time since 2019, according to figures released by SMMT on Thursday. This represented a 17% increase, supported by a broad recovery in the auto market and strong exports to Europe. .
“We’re back in the game,” SMMT chief executive Mike Hawes said.
Mr Hawes said manufacturers with factories in the UK had been able to make key spending decisions over the past year as relative political stability returned to the UK after a turbulent period between 2016 and 2022. He says he feels that
“The UK has been nearly uninvestable for years.” [with] Brexit negotiations. . . “Due to political instability, economic uncertainty, it was difficult to attract investment,” Hawes said. “This is a relief.”
SMMT calculations have announced that total new investment in the UK car industry will total £17bn between 2016 and 2022, with last year’s figures rising to £15bn from JLR and £15bn from Nissan. An additional £2 billion was added, bringing the total to £23.7 billion.
He added that although the majority of investment was from existing factory owners rather than new entrants, the UK was still successful in winning jobs thanks to fierce competition from European countries such as Spain. .
“We took what we had and built on it, which is no mean feat,” Hawes said. “If we lost them, our resilience would be gone.” [production] Volume becomes even more difficult. ”
He said the UK needed to “catch up” with its European rivals, which are still ahead in key areas such as the development of battery factories, and said the UK needed to “catch up” with its European rivals, which are still ahead in key areas such as the development of battery factories, and energy He warned that costs needed to be improved.
Hawes said closer trading ties with Europe, which Labor has promised if it wins this year’s general election, would make British manufacturers more competitive.
He added that energy remained the highest cost for carmakers after wages, and the industry had consistently asked ministers for support.
Some car factories have tried to produce their own energy using wind turbines and other generators, but there have been problems with securing the national grid.
The number of cars produced at UK factories last year rose to 905,000, while van production rose to 120,000.
For next year, SMMT’s independent forecasts predict that total production will rise again from 1.02 million to 1.04 million vehicles, although car production will decline slightly as older models are phased out.
More than a third of British cars produced last year were hybrid or electric models, a record high. Nissan makes the Leaf electric car and BMW makes the Mini electric car.
Almost all the cars built by Toyota in Burnaston, Derbyshire, are hybrids, but Vauxhall owner Stellantis began building electric vans at Ellesmere Port last year. JLR also offers models with plug-in hybrid technology.
UK car production peaked at more than 1.6 million cars before the 2016 Brexit vote, but Honda’s Swindon plant closure in 2021 and JLR’s downsizing strategy mean the country could produce up to 1.1 million cars a year. become. SMMT said the total was unlikely to exceed historical records without new investments.
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