Domestic Demand Drives First-Half LV Output in U.K.

U.K. car manufacturing climbed 10.4% year-on-year in June to 131,586 units, pushing first-half production up 1.1% to 764,390.

The Society of Motor Manufacturers and Traders says while four out of five cars built in the region are exported, volumes were boosted by a 24.4% jump in first-half output for the home market to 162,754 units.

SMMT interim CEO Mike Baunton says the first-half growth builds on a strong 2012, when manufacturing performed above pre-recession levels.

“Subdued demand in some European countries has held back production levels this year, but it is encouraging to see a significant rise in volumes destined for U.K. buyers,” Baunton says in a statement. “Independent analysts are confident that car output will grow in the long term, despite economic concerns on the continent.”

Manufacturing for the home market in June improved 18.7% from prior-year to 26,212 units. The export build was up 8.5% to 105,374, accounting for 80.1% of the total, but was not enough to offset a 3.8% drop in first-half output to 601,636.

SMMT says commercial-vehicle production rose 1.4% to 8,480 units in June, driven by growing domestic demand. However, it did little to cushion a 13.5% first-half drop to 48,517. Again, weak foreign demand depressed the numbers with exports representing 51% of the total volume, down from 61%.

SMMT Commercial Vehicle Manager Nigel Base says June’s modest uptick in CV output was driven by a 17% surge in domestic demand to 3,647 units, enough to overcome an 8.0% decline in exports to 4,833.

First-half CV production for the home market climbed 9.0% to 23,874 units, while exports fell 27.9% to 24,643. That reduced the export share of production to 50.8% from prior-year’s 60.9%.

“Year-to-date volumes offer a slightly gloomier picture…as CV manufacturers continue to feel the effects of weak demand abroad,” Base says. “The remainder of the year will be challenging, but strengthening U.K. demand is expected to support domestic manufacturers of vans, trucks buses and coaches.”

U.K. engine production gained 10.9% in June to 225,266 units, but the first-half result was down 1.2% to 1,319,998. SMMT says output has performed in line with the region’s vehicle-manufacturing trends.

Production for the home market rose 17.6% last month to 91,561 units, while exports advanced 6.7% to 133,705.

The first-half build for the U.K. market rose 8.3% to 524,680 units, but export output slipped 6.7% to 795,318.