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Car production in the UK drops for the first time since 2009

The UK’s car production has dropped for the first time since the financial crisis in 2009.

Brexit fears have meant consumers have turned away from diesel vehicles.

According to the Society of Motor Manufacturers and Traders (SMMT) “A total of 1.67m cars rolled off UK production lines in 2017, down 3% compared with 2016 as demand for British-made cars dropped both at home and abroad.”

The decline in diesel demand is an issue because Britain is a main location for the manufacture of diesel engines.

Companies such as Toyota and Ford produce a large number of power units (totaling around one million). This a total of £8.5bn towards the UK economy.

The SMMT has also alerted that a hard Brexit could cut 10% off export production “overnight”.

Job losses have also been revealed by Vauxhall, specifically at their Ellesmere Port plant.

Vauxhall was attained by Peugeot in 2017, this was believed to be one of the most vulnerable to Brexit effect loss of investment in new models.

The SMMT have continuously alerted the threat Brexit poses to the UK’s auto production, as it has been a successful industry since the 1980’s.

The industry has attracted investment from some of the most successful businesses in the world.

According to figures 80% of cars made in the UK are made for export markets.

In 2017, cars made for overseas markets fell 1.1% to £1.33m and those made to sell in the UK dropped 9.8% to 336,628.

The EU is the UK’s largest market for export for vehicle.

The UK industry has abandoned an aim to build more than 2 million vehicles a year by 2020 because of the uncertainty Brexit poses.

The furthers decisions made on the UK car industry will lie in the detail of any UK-EU trade deal.

According to SMMT sources, “UK-originating content on motor vehicles may turn out to be rather less than the 50 per cent needed to meet the “rules of origin” terms of freest trade agreements and to gain zero tariff access to the EU.”

Ultimately, if that is true then there are possible serious consequences under potential new trade regimes for exports.

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