November dip in car production 'is just a blip'

The UK's automobile industry has been advised not to worry about a slightly disappointing November in terms of production levels.

Recent figures from the Society of Motor Manufacturers and Traders showed there was a 3.6 per cent reverse in the number of vehicles built in Britain last month in comparison with the same month last year.

But the year-to-date figures are still 4.5 per cent up on 2012, so the motor brands that use the UK as a production base have been told not to worry about a single month of decline.

John Leech, UK head of automotive at KPMG, said one reason for the trend is that several manufacturers - including BMW and Nissan - are in the process of preparing for new model launches, so have turned down production levels on previous cars as these sell out.

"The industry is in confident mood as its key export market, the EU, continues to recover, posting its third straight monthly sales increase. Most analysts are now forecasting EU car sales will grow in 2014, reversing six-straight years of falls," the expert explained.

He went on to note it is not only sales to Europe that will keep the UK car production market progressing nicely, as the domestic sector is also looking good.

While Britain's car market is not expected to grow as quickly in 2014 as it did this year, it should still record expansion of around five per cent. Mr Leech noted this is proof that it is "almost back to its long-run sales average".

With prospects for the sector continuing to look strong, there may be a good chance that more automotive jobs will be created in 2014 as many major brands look to increase production.

Looking overseas, Mr Leech added that car sales in northern EU countries are around three-quarters of their long-run average, while in Mediterranean nations the rate is about half of the typical figure. This highlights just how bright the UK's new vehicles market is.

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