Friday, 21 April 2017

UK Net Car Importer In 2015

Bentley is small in numbers but big in value added

I'm not taking sides with the Brexit issue, nor do I claim (unlike some 'experts') to know how UK's exit from the EU would affect the UK if it goes ahead. However, the SMMT (which represents the British car industry and importers) is most anxious that the UK stay within the EU. The reason is to protect British car manufacturing. I don't get the logic and I will explain why.

If it exits, Britain may face an import duty of 10% selling cars in Europe. I assume that would apply both ways. The UK imports more cars from Europe than exports there, by some margin. So exports to Europe would be reduced and imports from Europe likewise. It doesn't take a rocket scientist to work out Europe has more to lose by tariffs, especially Germany.

What it means:  European car manufacturers do very well out of the UK, notably Germany and Spain.

Moving on from that subject I have gone back to 1981, comparing how many cars are made in the UK against how many are sold there. In 2015, the UK made nearly 1.6 million cars and bought over 2.6 million. That's a deficit of nearly 1.05 million or -39.7%. That is the second lowest percentage since 1989.

The chart below is in thousands, so three zeros have to be added to each figure. It shows the car companies that assemble in the UK and whether they export more than they import. For example Nissan produced 475,000 cars and sold 154,000 in the UK, making it a net exporter of 321,000 cars. If a car brand isn't there, then they don't make cars in Britain. Either that or they are too small to be counted, such as Aston Martin, Lotus, Morgan etc. (Those other small makes add up to 17,000 cars, as seen in the 'Rest' column).

Summary: Comparing 2014 and 2015, UK car sales grew faster than UK production by nearly 100,000 cars compared to the previous year. That took the deficit figure from 951,000 to 1,046,000. 2016 should see the sales increase slowing or even plateau, while car manufacturing will increase quite strongly. Britain will never again be a country that makes more cars than it buys, but not that many nations are in that position. The value to the UK economy car manufacturing brings is still very substantial.




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Net Importer



Data source: SMMT.

The Jaguar F-Pace will be part of the 2016 figures

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