UK car industry’s 1m-vehicle-a-year target set back two years to 2025 | Automobile industry

Britain’s auto industry has said it won’t be able to produce one million vehicles a year until 2025, two years later than expected, after the global sector was hit by a series of crises.

Russia’s invasion of Ukraine, China’s Covid-19 lockdowns and the continued shortage of computer chips have all combined to stall the recovery of car manufacturing, leaving automakers unable to supply enough cars to buyers volunteers.

The problems will cost British industry 113,000 sales this year, according to a forecast commissioned by the Society of Motor Manufacturers and Traders (SMMT), a lobby group.

UK factories built 403,000 cars in the first half of the year, down 19% from 2021 despite improvements in May and June. Production in June rose 5.6% year-on-year, even after Honda closed its Swindon plant and Vauxhall switched another to make vans.

SMMT chief executive Mike Hawes said the industry was partly suffering from “long Covid”, as the problems caused by the pandemic dragged on. Shortages of semiconductor computer chips “will definitely be with us this year and probably next year as well,” he said. Shanghai, a major source of coins as well as a major port, underwent a strict two-month lockdown in the spring.

Russian aggression has compounded the problems. Ukraine was a major supplier of cable harnesses, cheap but crucial components that hold cables together.

“We’re still not quite in Covid recovery mode,” Hawes said, despite “a degree of optimism. The challenge is supply.

The car industry has largely managed to avoid the most recent problems during the shortest Channel crossings in the UK, which have been blamed on additional post-Brexit checks and high tourist numbers. The industry has moved to other ports such as Immingham in Lincolnshire and Southampton, which are less vulnerable to tourist traffic which has wreaked havoc in recent days in Dover and Folkestone in Kent.

However, Hawes said the industry was still affected by Brexit issues. The SMMT has written to the government asking for an extension of time for a new post-Brexit type approval – safety checks required for every model sold. Before the UK left the EU, type approvals in other countries were valid for sale in Britain, but the government has given 18 months to put a new regime in place.

So far, it has failed to produce the regulations governing this scheme, which has raised concerns in the industry about possible delays.

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