A Historic Low: UK Car Production Dips to 70-Year Low Amidst Tariffs and Electrification Shift

In April, the UK experienced a staggering drop in vehicle production, manufacturing only 59,203 vehicles, marking the lowest output for April in over 70 years (excluding 2020 when production halted during the Covid-19 lockdown). This decline is attributed to tariffs, the timing of Easter, and the industry’s transition from petrol cars to electric vehicles (EVs). Compared to April 2022, production fell by 16% and was 25% lower than March of the same year, which had likely seen a temporary surge due to manufacturers shipping cars to the US ahead of President Trump’s tariffs.

The Society for Motor Manufacturers and Traders (SMMT) reported that car production for exports dropped by 10.1%, largely influenced by decreased demand from the US and EU, the UK’s major export markets. The first four months of 2023 saw the lowest overall vehicle output since 2009.

Prof. Peter Wells, director of the Centre for Automotive Industry Research, highlighted that this downturn isn’t unique to the UK but is part of a broader trend affecting countries like Germany, Italy, France, and Japan. However, he noted that the UK’s pressures may be more intense, particularly with Chinese imports facing fewer trade barriers compared to the EU and US. He stressed that the UK’s recent government policy revisions around EV production have led to

increased uncertainty, particularly with the relaxation of sales targets for EVs and reduced penalties for non-compliance with emissions standards.

The automotive industry has faced significant challenges, with several manufacturers like Honda and Ford shutting down plants, and Stellantis warning about potential halts in production due to the Australian government’s unclear stance on EV policies. Prof. Wells concluded that the industry desires stability and clarity regarding policies around tariffs, electrification, and other pivotal issues, calling the current environment volatile.