SMMT interim chief executive, Mike Baunton, has hailed the robustness of the UK automotive market but is encouraging the British government to develop a 10-year strategy to build on its success.
The UK is proving remarkably resilient in the face of plunging confidence in Europe with first quarter figures showing sales in Britain rising 7.4% to 605,198 units.
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Private retail sales also increased 11% making up slightly less than half the total.
“If we were in France, Spain [and] Italy, we would be very depressed, their markets have cratered,” said Baunton. “We are, in the UK, doing very well relative to the dips and it seems to be thriving. We are seeing [sales] about 3% up on last year.
“Retail is doing well and it is a good sign that, as an industry, we are convincing customers to buy smaller, fuel efficient vehicles and there are good finance deals out there.
“We have the world’s most efficient car plant in Nissan in Sunderland. Investment in the UK is a great story – GBP6bn (US$9.3bn) has been committed also in the supply chain and in a range of support structures. It is a huge success story in a period of poor economic growth.”
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By GlobalDataBaunton highlighted the opportunities for the UK automotive industry to tap into the British government’s industrial strategy that has proved so successful for the country’s aerospace sector.
“In the summer there will be an automotive strategy launched and we are working very hard with the Automotive Council and government departments,” he said. “It is skills, supply chain and new technology, all three of these are critical.
“We are getting the government hopefully to come out with a 10-year strategy to transcend the next election and the election after that. We want to focus very strongly on longer-term technologies, not just fuel cells and electric motors, but also materials and technologies needed for advanced internal combustion engines of the future.”
Despite the SMMT’s undoubted optimism, Baunton realistically set out the recent healthy numbers against a pre-recession backdrop showing just how tough the environment is.
“In 2003/2004, we were way higher than today,” he said. “As good as the [numbers] appear today, it is nothing close to where where it was before.”
Analysts at Deloitte have also weighed in with encouraging noises as to the UK’s strong performance compared to its European cousins noting that, had it not been for growth in the British market, Europe’s decline would be closer to 14% for the first quarter of the year.
“It will be a couple of weeks before we can compare the like for like performance of the UK market this month with our European neighbours,” said Deloitte UK manufacturing leader, David Raistrick. “However, the first quarter provides a startling level of perspective.
“The UK in the first three months of the year has closed the gap with Germany; from 210,000 cars to March 2012 to just 68,000 in 2013. The UK is now the second largest market for new car sales in Europe with sales 39% ahead of France and 70% ahead of Italy.”
