UK automotive manufacturing has broken financial records, with turnover at £69.5 billion in 2014, up from 65.2bn (6.6%) the previous year.
New figures released today in the Society of Motor Manufacturers and Traders’ 16th annual Sustainability Report shows manufacturing output, vehicle sales, jobs and export values also grew.
The latest figures confirm an upward trend for new vehicle demand and manufacturing output, with almost 1.6 million vehicles built in 2014.
Last year, car production grew to 1.53m units – the highest level since 2007 – with an increasing number of vehicles built for the domestic new car market, which itself grew 9.3% to reach 2.48m registrations last year.
On current trends, UK car output is expected to reach an all-time record level of 1.95 million vehicles in the next two years.
Meanwhile, investment in more efficient, high-tech manufacturing processes has led to gains in productivity.
In each of the five years to 2014, an average of 11.5 vehicles were produced for every person employed in the industry, compared with 9.3 vehicles for the period from 2005 to 2009.
Despite greater production volumes, environmental impact has been reduced.
Total waste to landfill from all automotive production fell by more than a quarter (26.3%) in 2014, and an exceptional 92.3% since 2000.
Meanwhile, water and energy use fell by 10.7% and 10.4% respectively, and CO2 emissions per vehicle produced fell by 5% compared with 2013. Industry has also made considerable improvement to its already outstanding safety record with the number of workplace incidents per 1,000 employees falling to an all-time low of 2.2 – down 83.9% on 2002, when data was first collected.
Mike Hawes, SMMT chief executive, said, “The UK automotive industry can be proud of its achievements as it continues to set new standards.
“The sector is delivering growth in volumes, turnover and employment, while reducing its environmental impact.
“Continuing to expand in a fiercely competitive global market is a major challenge and will depend on a supportive economic and regulatory environment which promotes investment to foster innovation and continuing productivity improvements.”
Large investments are still being committed to new and expanded production facilities in the UK, resulting in significant sector-wide recruitment, with an additional 27,000 jobs created in 2014 – a 3.5% increase on the previous year.
The number of people employed in automotive (including manufacturing and retail) now stands at 799,000, with the average worker responsible for generating £440,000 in turnover for the sector.
Investment in skills has also been crucial with employee training up by more than a third (35.2%) and some 500 new apprentices and trainees taken on by the sector last year.
International demand for British-made vehicles also continues to increase with total export value rising 1.8% to £34.6 billion – a 103.8% uplift since 2000.
It adds up to a considerable increase in the industry’s direct contribution to the British economy, rising 6.2% to £15.5bn last year.
> The SMMT figures do not include UK franchised dealer retailing. The AM100 reports turnover at:
2015: £51.7 billion
2014: £45.6bn
2013: £40.6bn
2012: £38bn
Jeremy has been a journalist for 30 years, 20 of which have been in business-to-business automotive. He was a writer and news editor on AM-sister brand Fleet News for three years before setting up the AM website. For the last five years he has been Bauer B2B’s head of digital helping to manage the digital assets of AM, together with Fleet News, Commercial Fleet, Rail and Smart Transport.
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