News Analysis: Demand For British Cars Drops Overseas

There are early signs that the British automotive manufacturing industry may be starting to suffer as a result of falling demand overseas. Over the first 10 months of this year the industry has notably suffered, with global economic uncertainty being the most apparent reason.

According to official number from the Society of Motor Manufacturers and Traders, production is down 0.3% on the same period the year before. The figures get grimmer still when you consider that the number of cars built domestically but intended for export are down 1.4%.

Global economic difficulties are seemingly to blame for this downturn, which can certainly be a plus side for our industry. It at least means that the competition is suffering from the same poor conditions as they are. It also means that it is not directly concerned with the perceived quality of British automotives.

Another strong positive point for the industry is that 0.3% is certainly not an irreversible number. Such a percentage reflects a bump in the road, rather than a complete pile-up as far as the economy is concerned. With a bit of good management, and some forward thinking this will all be behind us in a year or so.

That said, these are numbers for concern. The last time that the UK automotive was in decline in any comparable way was during the recession of 2009. At times such as these, the automotive should be looking forward and investigating ways to establish sustainable patterns of growth.

The used car economy, stemming from sites such as, is a fine example. The export driven manufacturing industry has slowed down. But the domestically focused used markets have sustained or grown in popularity. This vitally indicates that although the economy is downturning, there continues to be an appetite for “new” vehicles. This in turn indicates that it is the condition of the economy, rather than the nature of the product, which are resulting in this change.

Ford_Motor_Company_assembly_lineSource: Wikipedia

Nevertheless, the automotive industry should be thinking progressively. There is always the potential, even in a receding economy, to establish your own corner of the market. Certain brands and technologies will always be immune to the whims of the markets, and Britain should be working to find and develop in those areas.

We should be promoting electric car growth to address the long term growing market. We should also be moving to refocus on certain aspects of our luxury and heritage car production. As the middle class markets for such products continues to grow in the East, investing in these aspects of our industry will yield great benefit in the middle term.

We should also consider the new reality of such an economy. How many more downturns can be taken before the industry collapses under its own weight? It would seem as though now would be the perfect time to stip the non-essential or liable assets of the manufacturing base, in order to promote a lean and viable industry.

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