<img alt="" src="https://secure.leadforensics.com/130144.png" style="display:none;">
VHR Global Technical Recruitment
Log In & Register 

How Strong is the UK Automotive Industry?

  • by: Conor McKeon
  • On: 25, Oct 2018
3 min read

The Automotive industry is one of the largest, most competitive industries in the world. It’s worth over $1.7 trillion. Nearly 95 million cars were produced in 2016, and this number is rising all the time.

A symbol of wealth and status, as well as a method of transportation, cars are used all over the world by people from all walks of life. The industry has changed monumentally in the last century, with automation and computers changing how cars are made.

We’re now in a similar period of transition with AI changing how the Automotive industry works, and Brexit impacting how easy it will be for the UK to trade.

With giants like the USA and Europe dominating the Automotive industry, you’d be forgiven for thinking that the UK doesn’t add much to the global Automotive industry. But you’d be wrong.

How Strong Is the UK Automotive Industry?

The UK motor vehicle manufacturing industry contributed £20.2 billion to the economy in 2017, making up 0.8% of total output, but 8.1% of manufacturing output. This is up from 5.6% in 2010.

The UK Automotive sector is a powerhouse to the UK economy, employing 856,000 people, with 186,000 of those working directly in the manufacturing chain.

What the UK Automotive Industry Exports and Imports

1.75 million vehicles were produced in the UK in 2017, 80% of which were exported. The total value of these exports was £44 billion; well over 10% of the total UK export value. The UK imported £13 billion worth of vehicle parts last year, 17% of which were from Europe.

With Brexit throwing trade agreements and relationships into question, it is possible that our Automotive imports and exports to and from Europe will slow down or become more expensive. Direct exports to the EU already account for over half of all UK exports, but a further 10% of all car exports are delivered to countries under free trade agreements signed with the EU. These include exports made to South Korea, Canada and Turkey. In theory, up to 64% of UK exports are at risk from Brexit.

What the Future Holds for the UK Automotive Industry

Investment in the UK Automotive industry dropped by a third after the Brexit result, but there’s no way of knowing whether the fear was justified until a deal (or not) has been reached and agreed.

The UK may need to find new markets to export to, but its worldwide reputation for Automotive manufacturing of the highest quality will go a long way to securing new relationships. Luckily, 18 of the top 20 biggest Automotive suppliers have a UK base. There are over 30 manufacturers operating in the UK and over 2,500 suppliers providing component parts. Leveraging these relationships and securing new deals will be vital for the continued growth of the Automotive industry.

The government is also stepping in to prove to other countries that the UK is worth investing in. When Nissan invested £240 million into its Derby plant, the government helped with a grant worth £21 million. The UK government has also launched the ‘Automotive Sector Deal’ which has £32 million of joint funding to develop an ‘industry-led supply chain’ that will encourage growth. It also has £500 million of government funding, matched with a further £500 million of industry funding to develop new low-carbon technology. Lastly, they’ve also invested £246 million to make the UK a world leader in design, development and manufacturing of batteries for electric vehicles.

UK Automotive investment suggests understanding from the UK government of how important the Automotive industry is to the UK economy and to the wider world. By championing the industry, the UK should see positive growth no matter the direction of Brexit.

The UK Automotive industry is involved in a global supply chain and the UK is a vital part of this. By working together, UK Automotive manufacturers will see new ideas, new opportunities and new horizons.

Find out more about our Automotive recruitment services or check out our Automotive jobs.

More Posts You May Like...

3 min read

What is the F1 Cost Cap?

There are many things that go into making a champion F1 team: skill, knowledge, ingenuity. But one thing matters most, e...

Read full blog
3 min read

The Best F1 Circuits of all Time

Since the Formula One World Championships began in 1950, over 60 circuits have hosted at least one grand prix. That’s a ...

Read full blog
3 min read

What It Takes To Work In F1

Formula One is one of the most demanding fields in engineering. Engineers around the world dream of working in Formula O...

Read full blog