The UK's vehicle production sector has been handed a timely boost by news contained within the chancellor's latest Budget.

George Osborne set out his financial plan for the country yesterday (March 19th) and the Society of Motor Manufacturers and Traders (SMMT) believes he has delivered a set of measures that will support manufacturing throughout the country over the coming months and years.

What's more, the organisation said Mr Osborne has acted to encourage both investment in the sector and a rise in exports to international markets.

Mike Hawes, chief executive at the SMMT, said the focus on investment, exports and skills, not to mention steps designed to reduce the energy costs associated with vehicle production, has been welcomed by those within the motor industry.

"Extending and doubling the Annual Investment Allowance and improving export finance are important signals to encourage the UK's manufacturing base, helping trigger greater business investment and enhancing our export capability.

"In line with welcome reductions in energy costs, we ask government to look at business rates to ensure the system works for manufacturing and maintains our global competitiveness."

Mr Hawes went on to explain the SMMT is delighted with  measures that have incentivised the production of ultra-low emission vehicles, thanks to the new company car tax scheme.

Exporting is undoubtedly crucial to the UK motor market, with around 80 per cent of the models produced in Britain shipped to other countries. These allow the UK to remain a hub of innovation and manufacturing.

R&D tax credits will also go some way towards helping companies, particularly small and medium-sized enterprises.

Plans to double the Annual Investment Allowance to £500,000 and extend it to 2015 will also persuade firms to spend more on their plants and machinery.

With things seemingly looking up for the UK's motor industry, it may be time for many of the sector's largest names to take on new staff in automotive jobs to ensure they are ready to meet demand in the years to come.

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