It’s catastrophic that UK car production has fallen so dramatically

It’s decision time for the bruised and battered car industry of Britain. First it has to take a long, hard look at itself and ask why and how it allowed its annual production to plummet from 1.3 million-plus in 2019 to just under 800,000 last year. Then it has to decide if it’s fit, able and willing to, at the very least, re-establish itself as one of the world’s top 20 car producers. Either way, it’s catastrophic that UK output has fallen so dramatically in just half a decade.

UK car makers are going backwards in car production terms. And the figures will get worse before they get better. That’s if they do get better! The Society of Motor Manufacturers and Traders reckons the transition from ICE to electric cars is largely to blame for fewer cars rolling off UK production lines. But I’d argue the transitioning period is overplayed and has already been going on for years.

At JLR (which recently lost its position as Britain’s biggest car maker), engineers, designers and countless others spent a big chunk of the 2010s developing, producing, testing, launching and eventually selling (from 2018) the pure-electric Jaguar I-Pace. Yet the company has already killed off the Mk1 version. And there’ll be no Mk2. So EVs are nothing new to Jag. And all this makes the firm’s decision to shut up shop and build/sell no new Jags in 2025 utterly baffling. To add insult to injury, the closure will further damage the UK’s production volumes for the year. And even if or when Jaguar reopens its production lines, it’ll surely build far fewer cars, because its future luxury-only models will be super-expensive (£100k-plus) and will have comparatively low build and sales figures.

Sister firm Land Rover also needs to think carefully about its new strategy of charging over £100,000 for its entry-level, old-tech (ICE) Range Rovers. It’s already told me that it’s keener to sell more eye-wateringly expensive cars with huge profits than cheaper, far less lucrative versions. That inevitably means far fewer Range Rovers to be produced, right?

Also, don’t be surprised if, when it eventually arrives, the ‘cheapest’ all-electric Range Rover is around £150k, with top-end versions costing hundreds of thousands. That’ll make them niche products, which in turn means comparatively low production. Again, not good.

But unacceptably low UK car production volumes in 2024, 2025 and possibly longer aren’t just a major problem for makers and underworked staff. The Government has to get involved – by trying to attract productive, tried and tested firms to build British factories.

Nissan (our biggest producer) and Toyota have been great for UK productivity, growth, and job and wealth creation. Other foreign firms could and should be invited in and incentivised to do the same. If they’re not, I fear the UK will drop further down the global production league and become a fourth-division car-making nation. And that’s not what broken Britain, stalling factories and hungry British car workers want or need right now.

Do you agree with Mike? Let us know your thoughts in the comments section...