July

Car production in July hits lowest level since 1956

Stock image of UK car production

Stock image of UK car production

UK car production fell sharply last month, marking the worst July performance for the industry since 1956, a trade group has said.

The global microchip shortage, staff being affected by the so-called pingdemic, and shutdowns meant just 53,438 cars were built in the month.

That was a drop of 37.6% compared to July last year, the Society of Motor Manufacturers and Traders (SMMT) said.

It comes as sales of second-hand vehicles are soaring.

Overall car production in the year to date is almost a fifth higher than during 2020 at 552,361 vehicles, but that is still 28.7% down on 2019 pre-pandemic levels.

UK car production graphic

UK car production graphic

SMMT boss Mike Hawes said the July figures “lay bare the extremely tough conditions UK car manufacturers continue to face”.

“While the impact of the ‘pingdemic’ will lessen as self-isolation rules change, the worldwide shortage of semiconductors

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UK car production in July at lowest level since 1956 amid ‘pingdemic’ and chip shortage

Potential customer walks around Charles Hurst Usedirect used car dealership on Boucher Road in Belfast as restrictions in Northern Ireland ease allowing new and used cars sales.

In July production for the UK market declined -38.7% to 8,233 while manufacturing for export also fell, down -37.4% with 45,205 cars shipped overseas. Photo: PA

UK car manufacturing declined to the lowest level since 1956 in July, down 37.6% due to global chip shortages and the ‘pingdemic’ slowing down production.

The Society of Motor Manufacturers and Traders (SMMT) said some manufacturers had changed their summer shutdown timings to manage the rout. 

In July production for the UK market declined -38.7% to 8,233 while manufacturing for export also fell — down -37.4% with 45,205 cars shipped overseas. 

“These figures lay bare the extremely tough conditions UK car manufacturers continue to face,” said Mike Hawes, SMMT CEO.

Chart: SMMT

Chart: SMMT

Exports accounted for more than eight out of 10 (84.6%) vehicles built in the month as buyers around the world continued to be attracted to the wide range of high-quality cars made

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Sticker shock: Average new car prices hit a record $41,000 in July

The number of new cars being sold is from record levels, but the prices being paid for them are the highest ever.

According to the J.D. Power and LMC Automotive Forecast, the average transaction price for a new vehicle is projected to be $41,044 during the month of July, a 17% increase over last year.

High demand is meeting low inventories caused by the ongoing semiconductor shortage hampering production across the industry, which has led to a drop in incentives and more cars selling for list price or even more.

“Eight percent consumers are paying near or above MSRP, which is driving up dealer profitability over 200% compared to 2019. But

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Widespread uncertainty causes 20% July drop in UK car production

A car salesman shows customers vehicles in a Vauxhall dealership in London on June 4, 2020, as showrooms in England reopened. Photo: Justin Tallis/AFP via Getty Images
A car salesman shows customers vehicles in a Vauxhall dealership in London on June 4, 2020, as showrooms in England reopened. Photo: Justin Tallis/AFP via Getty Images

The collapse in global demand for new cars caused by the coronavirus pandemic continued to drag on the UK automotive sector in the month of July, with car production down 20.8% compared to July 2019.

The latest data released by the Society of Motor Manufacturers and Traders (SMMT) shows that 85,686 vehicles were manufactured last month.

While production lines at nearly all of the UK’s car plants were rolling again, severe economic uncertainty surrounding the pandemic and social distancing measures at dealerships put a dampener on demand.

“As key global markets continue to re-open and UK car plants gradually get back to business, these figures are a marked improvement on the previous three months, but the outlook remains deeply uncertain,” said SMMT chief

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