In the first half of this year, car production in the UK has fallen 42.7%, with just the production of 56,587 units. The last time the production rate was this low, the UK was recovering from World War 2 effects.
The coronavirus crisis affected many industries and resulted in the firing of hundreds of thousands of employees, and the car industry is no different. The situation is better than what it was before, but still is not under control, and to prevent it from getting out of control, certain measures are required. Although the government has allowed dealerships to open and companies to start manufacturing, they have to follow a strict guideline. Strict guidelines mean low production and low production means many employees would lose their jobs.
There are 820,005 workers in the car industry, 168,003 of which are associated with manufacturing. The Society of Motor Manufacturers and Traders (SMMT) has warned that the situation can get worse and more employees can lose jobs.
Till now, 11,004 jobs have been lost due to the crisis in the car industry, according to the SMMT. Companies like Aston Martin, McLaren, and Nissan and many retailers had to let go of many employees.
But the SMMT chief executive Mike Hawes things can get even worse, as from October onwards even more employees can lose jobs. The reason behind this is in October the Government’s job retention furlough scheme would end. So, the car industry could suffer even more, so some quick action is required both by the government and the companies.
He also said that we don’t have a crystal ball, but we can see what’s happening and predict what would happen in the future. The figures are scary and show the difficulties the companies are going through to resume the manufacturing process and sell cars to the customers. All industries have suffered and the recovery process is difficult for all, but it’s even more difficult for the automobile industry.
Last year, 285,005 more vehicles were made in the UK as compared to this year and they hold a combined value of £7.8bn. There are four main reasons behind this fall in the production, the global demand for new cars is low, factories are closing, reduced production capacity due to strict measures, and the shift of focus from making cars to selling stocks of the manufacturers and dealers.