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Weekly News Review | 30 January 2017 | Automotive Purchasing and Supply Chain Automotive Purchasing and Supply Chain

Talking Point

Brexit troubles loom despite another successful year

Yet again, the UK manufacturing industry boasted record sales figures in 2016, a 17 year high thanks to growing global demand. Last year, 1,722,698 vehicles rolled off production lines from over 15 OEMs in the region, an increase of 8.5% from 2015. More cars were exported from Britain than ever before, thanks to investments in production facilities, advanced technologies and skilled workforces. This strong growth has helped make the UK the third biggest car producer in Europe after recording its highest output since 1999 - things are looking up.

However, despite a successful 2016, the industry must be aware of the consequences following the Brexit referendum, which has left the global automotive industry in an extended period of uncertainty. SMMT Chief Executive Mike Hawes touched on this subject within his speech at the SMMT lunch last week, commenting: “We want trade deals but they must be the right deals, not rushed deals. Failure to do so could damage UK automotive manufacturing beyond repair.” Hawes was, for the most part, in high praise for the state of UK manufacturing, although he rightfully highlighted the importance of patience and strategic thinking if we want to come out of this successfully.

A lot is on the table, so it is vital that the UK plays its cards right as global automakers hide business outlooks close to their chest. Many will consider relocating in neighbouring countries that remain in the European Union, which would halt development and significantly push UK manufacturing back behind the competition. Thankfully, the UK does specialise in premium cars, something that continues to grow in demand around the world. Brands like Aston Martin, Bentley, McLaren and Jaguar Land Rover have been dominating the segment and will continue to do so over the following years, which will hopefully bring in further investment. Although, this does not mean that we can afford to lose other OEMs, who have heavily invested and provided a significant number of jobs in the UK. Nissan, for example, has helped grow and develop the Northern Powerhouse through investment, providing thousands of jobs in its Sunderland plant and revitalising the area.

If the UK can maintain its investments, it can continue to grow and develop into the global powerhouse it is destined to be. Now is the time for ‘home-grown’ automakers to step up and support the future of UK manufacturing.

Alex Kreetzer

Alex Kreetzer - Digital Editor

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