London—British annual car production has dropped to the lowest level since 1956, largely owing to global shortages of semiconductor chips, industry data showed Thursday.
Around 775,000 cars were built last year by the country’s mainly foreign-owned vehicle manufacturers, down almost ten percent from 2021, the Society of Motor Manufacturers and Traders said.
Output in 2022 was down nearly 41 percent compared with before the Covid pandemic in 2019, the SMMT added. At the same time, the UK produced a record number of electric vehicles, the data showed.
“The main reasons for the depressed output (overall) were the crippling global shortage of semiconductors, which limited the ability to build cars in line with demand,” said the organization.
Output was hit also by “significant structural changes, reflecting a loss of production at two-volume manufacturing sites — and the impact of supply chain pauses in China due to Covid lockdowns”, the SMMT noted.
Japanese car giant Nissan produced the most vehicles at more than 238,000, up 16.5 percent year-on-year.
The next biggest was Indian-owned Jaguar Land Rover, with nearly 203,000 cars, although this was down more than eight percent compared with 2021.
The Mini, owned by German group BMW, was the most exported model, followed by the Nissan Qashqai.
Almost 80 percent of the vehicles produced last year were made for export, with the biggest demand coming from the European Union. The UK car sector has managed to swerve post-Brexit trading obstacles suffered by other industries.
The next biggest market was the United States, snapping up 13 percent of UK-made cars. The EU accounted for almost 58 percent.
“The demand has been there the last two years, but (carmakers) haven’t been able to meet that demand because they can’t make enough,” the SMMT’s Mike Hawes told a press conference to discuss the data.
“Most of them have relatively long-order banks. So that, to a certain extent, is going to provide a buffer against what will be a drop in consumer confidence” as inflation remains stubbornly high.
“Certainly the second half of the year is probably going to be tougher than the first half,” he added.
Hawes said car and light van output should increase by about 15 percent in 2023.
“We think we’ll get back over a million (cars) probably in two years’ time.”
Hawes was also positive regarding the increasing switch to manufacturing electric vehicles.
“About a third of the vehicles we make are either pure electric, plug-in hybrid, or hybrid,” he told reporters.