Car production drops sharply in April

Fall echoes slump in sales, although
Society of Motor Manufacturers & Traders says industry is in
‘good health’

One-Minute Read

But according to figures published by the Society of Motor
Manufacturers & Traders (SMMT) yesterday, production slumped by
almost a fifth last month, marking the sharpest slowdown for two
and a half years, says The Guardian.

A total of 122,116 cars were
built in April, an 18 per cent fall on the same month last
year.

Rather than signalling the brakes being put on the industry’s
growth, however, the SMMT blamed the drop on the late timing of
Easter, which fell in March 2016 but April this year and so “cut
the number of production days”, says the BBC.

“As well as the later Easter, the industry’s output in
April was also affected by strikes at three BMW plants in the UK in
a row over pensions,” it adds.

The slump in production echoed a fall in sales last month
of 20 per cent, which was also blamed on an exceptional factor, in
this case shoppers bringing forward purchases to avoid a rise in
upfront taxes on car purchases, says the BBC.

The SMMT said the industry remains in “good health” and
that 593,796 cars were made in the first four months of this year,
up one per cent on 2016 and the highest number for the period since
2000.

Rising sales are being driven by overseas demand, possibly
boosted by the fall in the pound making UK cars cheaper to export,
although this highlights the main concern on the horizon – a hard
Brexit, which could increase tariffs for trading with the
EU.

As most parts used in UK car plants come from the EU, “the
cost of assembling a car in Britain could increase by £2,370”, says
the Guardian.