UK car output falls in March as EV-transition gears up, says industry body

(Reuters) - Britain's car production fell 27.1% year-on-year in March as manufacturers wound down existing models and more plants transitioned to electric vehicle production, data from the Society of Motor Manufacturers and Traders (SMMT) showed on Thursday.

SMMT said the latest production outlook report by AutoAnalysis expects UK car and light van production to tumble 6.2% to about 940,000 units this year, primarily due to the model changeovers.

WHY IT'S IMPORTANT

This is the first time car output has dropped in six months and comes at a time when electric vehicle production has successively grown as giants like Nissan and Tata pour in billions in the country to ramp up EV plans in a bid to become net zero.

CONTEXT

SMMT has previously said manufacturers are offering "generous incentives" in a push to switch to zero-emission vehicles and called for further incentives from the government for private retail buyers.

The industry body also citied fewer trading days in March due to Easter for the fall in production.

BY THE NUMBERS

Around 59,467 cars rolled out of factory lines in March, compared with 81,605 units in the same month last year.

EV volumes made up more than a third of all production but dwindled around 30% year-on-year, mainly due to model changeovers, it said.

The production of battery-electric (BEV), plug-in hybrid (PHEV), and hybrid (HEV) vehicles in the UK surged 48% in 2023.

KEY QUOTES

"This fall is not unexpected given the wholesale changes taking place within UK car factories as existing models are run out and more plants transition to electric vehicle production," said SMMT Chief Executive Mike Hawes.

"We can expect further volatility throughout 2024 as manufacturers lay the foundations for a successful zero-emission future," Hawes added.

(Reporting by Anchal Rana in Bengaluru; Editing by Tasim Zahid)