Turnover in the UK automotive industry hit a record £69.5 billion in 2014, according to new figures released by the Society of Motor Manufacturers and Traders (SMMT).
The SMMT’s 16th annual Sustainability Report confirms the sector is breaking new records, and increasing its importance and influence in the global business market.
Manufacturing output, vehicle sales, jobs and export values all grew, during the year while the environmental impact from vehicle production has been reduced dramatically.
Increasing demand for new vehicles had its effect on manufacturing output, with almost 1.6 million vehicles built in 2014. Car production alone grew to 1.53 million units – the highest level since 2007 – with an increasing number of vehicles built for the domestic new car market, which itself grew 9.3 per cent to reach 2.48 million registrations last year.
On current trends, UK car output is expected to reach an all-time record level of 1.95 million vehicles in the next two years.
Meanwhile, investment in more efficient, high-tech manufacturing processes has led to huge gains in productivity. In each of the five years to 2014, an average of 11.5 vehicles were produced for every person employed in the industry, compared with 9.3 vehicles for the period from 2005 to 2009.
The SMMT is also pointing out the sector’s highly positive environmental performance. Despite greater production volumes, environmental impact has been significantly reduced.
Total waste to landfill from all automotive production fell by more than a quarter (26.3 per cent) in 2014, and has dropped an exceptional 92.3 per cent since 2000. Meanwhile, water and energy use fell by 10.7 per cent and 10.4 per cent respectively, and CO2 emissions per vehicle produced fell by five per cent compared with 2013.
The industry has also made considerable improvements to its already outstanding safety record with the number of workplace incidents per 1,000 employees falling to an all-time low of 2.2 – down 83.9 per cent on 2002 when this data was first collected.
SMMT Chief Executive Mike Hawes believes the UK automotive industry can be proud of its achievements as it continues to set new standards.
“The sector is delivering growth in volumes, turnover and employment, while reducing its environmental impact,” Hawes says.
But he also cautions Government to ensure the sector receives the support it needs going forward; “Continuing to expand in a fiercely competitive global market is a major challenge and will depend on a supportive economic and regulatory environment which promotes investment to foster innovation and continuing productivity improvements.”
Large investments being committed to new and expanded production facilities in the UK saw an additional 27,000 jobs created in 2014 – a 3.5 per cent increase on the previous year.
The number of people employed in automotive (including manufacturing and retail) now stands at 799,000, with the average worker responsible for generating £440,000 in turnover for the sector.
Employee training, meanwhile is up by more than a third (35.2 per cent) and some 500 new apprentices and trainees taken on by the sector last year.
International demand for British-made vehicles also continues to increase with total export value rising 1.8 per cent to £34.6 billion – a staggering 103.8 per cent uplift since 2000. It adds up to a considerable increase in the industry’s direct contribution to the British economy, rising 6.2 per cent to £15.5 billion last year.
The SMMT believes that the figures are further evidence of UK automotive’s renaissance, as the sector continues to innovate and invest huge sums in research and development to meet ever-stricter targets on CO2 emissions and air quality, and capitalise on the latest major trends in the global sector, such as connectivity and intelligent mobility.