UK car production rises in June as supply chain snags ease

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FILE PHOTO - An employee works on an Aston Martin DBS at the company’s factory in Gaydon

(Reuters) - British car production rose 5.6% in June from a year earlier, as supply chain snags began to ease and zero-emission vehicles saw a record month, an industry body said on Thursday.

The Society of Motor Manufacturers and Traders (SMMT) said 72,946 units were built in June, up from 69,097 units last year, but the output remains nearly one-third below 2019 levels.

The SMMT said it downgraded 2022 output forecast to 866,000 units after first-half production suffered its weakest since the pandemic-hit 2020 and was worse than 2009, when the global financial crisis decimated demand.

But output is expected to improve in 2023 to 956,575 units before surpassing 1 million units by 2025 as supply chain issues recede, it said.

The crisis in Ukraine, a major hub for automotive parts, as well as lockdowns in China and severe parts shortages have hurt car production in the United Kingdom.

"Car manufacturers have been suffering from a 'long Covid' for much of 2022, as global component shortages undermine production and put supply chains under extreme pressure," said SMMT Chief Executive Mike Hawes.

A bright spot was production of battery electric vehicles, which jumped 44.2% in June resulting in a record output of zero-emission vehicles for the month.

"Key model changeovers and the closure of a major plant last year have also impacted output, but there are grounds for optimism with rising output over the last two months," the SMMT said.

(Reporting by Shanima A in Bengaluru; Editing by Maju Samuel)

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