Carmakers shed 11,000 jobs as production set for worst year since 1957
More than 11,000 people in the automotive industry have lost their job in the last six months due to coronavirus, as the sector heads for its worst year of car production since 1957.
According to new figures from industry body the Society of Motor Manufacturers and Traders (SMMT), just 880,000 cars are expected to be built in the UK in 2020, 32 per cent lower than last year.
Thus far this year, a mere 381,357 units have been made, 42.8 per cent fewer than the 666,521 cars built in the same period last year.
The last six months have been the weakest for vehicle manufacturing since 1954. In April, at the height of the lockdowns caused by the virus, carmakers built just 197 units.
In June, this sprang back to 56,594, a figure which still represents a 48.2 per cent fall in production year on year.
As a consequence of the crisis, at least 11,349 job cuts have already been announced across the industry, including manufacturing, supply chain and retail.
Last month the SMMT warned that one in every six auto jobs could be cut as a result of the pandemic.
More than 168,000 people are directly employed in motor manufacturing in the UK, while th industry supports over 820,000 roles in total through its supply chain.
With the industry beginning a snail’s-pace recovery, attention has now begun to turn to the UK’s departure from the EU at the end of this year.
According to Auto Analysis, the production of more than 1.46m units, worth over £40bn, might be lost if the UK fails to agree a trade deal with European officials.
SMMT chief executive Mike Hawes warned that the importance of a trade deal was “ self-evident for UK Automotive”.
“Our factories were once set to make 2m cars in 2020 but could now produce less than half that number, a result of the devastating effects of the pandemic on top of already challenging market conditions and years of Brexit uncertainty”, he said.
If, as the SMMT hopes, the government can negotiate a trade deal with zero tariffs and quotas, production could recover to 1.2m units a year.
However, on World Trade Organization terms with 10 per cent tariffs, production would remain around the 800,000 mark, Auto Analysis said.