British car industry on track for 2 million vehicles a year

The number of jobs in the industry climbed 3.5 per cent in 2014 to 799,000

Britain will soon be making almost four cars a minute as the UK’s motor industry booms with record high production figures. The Society of Motor Manufacturers and Traders (SMMT) predicts the number of new vehicles being built in Britain will climb to almost 2 million by 2017, based on current trends.

In a new report it reveals that turnover hit an all-time high of £69.5bn last year, while almost 1.6 million vehicles were built, the highest vehicle production figures since 2008.

Last year, car production alone grew to 1.53 million units – the highest level since 2007 – with an increasing number of vehicles built for the domestic new car market, which itself grew 9.3 per cent to reach 2.48 million registrations last year.

Meanwhile the number of jobs in the industry climbed 3.5 per cent in 2014 to 799,000. The number of people employed in automotive manufacturing and retail increased by 27,000 last year, with the average worker responsible for generating £440,000 in turnover, said the SMMT.

It said that more efficient, high-tech manufacturing processes have led to huge gains in productivity. In each of the five years to 2014, an average of 11.5 vehicles were produced for every person employed in the industry, compared with just 9.3 vehicles in the previous five years.

The value of exports increased 1.8 per cent to £34.6bn last year, as international demand for British-made vehicles continued to grow. It’s risen 103.8 per cent since 2000. The industry’s direct contribution to the British economy increased 6.2 per cent in 2014, rising to £15.5bn.

Mike Hawes, the SMMT’s chief executive, said: “The UK automotive industry is delivering growth in volumes, turnover and employment, while reducing its environmental impact.” The society said there was a 5 per cent year-on-year reduction in CO₂ emissions per vehicle produced last year while waste to landfill from all automotive production fell by more than a quarter, and has shrunk 92 per cent since 2000. Water and energy use both fell by more than 10 per cent.

But the continued health of the sector would mean more support from the Government and regulators, Mr Hawes warned. “Continuing to expand in a fiercely competitive global market is a major challenge and will depend on a supportive economic and regulatory environment which promotes investment.”

He warned of global megatrends that could hit future growth, such as rising populations and their impact on scarce resources, climbs in wealth and urbanisation and, therefore, particular vehicle choices and constraints in the road network.