Car production slumps by 55 per cent

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The Independent Online

Car production fell sharply last month, dipping 55.3 per cent compared with April 2008, it was announced today.

Just 68,258 cars were made in the UK in April, the Society of Motor Manufacturers and Traders (SMMT) said.

Commercial vehicle (CV) production fell even further last month - declining 65.2 per cent to just 7,655 units.

The April dip means that total production for the first four months of this year is down 56.2 per cent compared with January-April 2008, while CV production is down 63.6 per cent.

The figures come as little surprise. In the light of a dramatic downturn in consumer confidence as far as new car-buying is concerned, UK vehicle manufacturers have cut back on production and jobs.

Now the motor industry is hoping that the Government's "cash for bangers" car-scrappage scheme introduced this week will kick-start production and new car sales.

Under the initiative, the Government and manufacturers share the cost of a £2,000 incentive which will be offered to owners of cars and light vans more than 10 years old if they exchange them for a brand new one.

SMMT chief executive Paul Everitt said: "With the scrappage incentive scheme fully operational, industry is optimistic about the positive impact this will have on the market and on UK production facilities.

"Despite the current difficulties, the UK must prepare for the return of global growth, and Government support for the industry is an essential part of the process."