The UK produced more than one million vehicles last year and welcomed an enormous £23.7billion investment boost to the thriving industry.
More than 905,000 cars and 120,000 commercial vehicles were produced across the country in 2023, helping to boost output by 17 per cent compared to the previous year.
This has been put down to global supply chain issues easing and the relaxation of pandemic-related challenges, as well as increasing electrified model production, according to the Society of Motor Manufacturers and Traders (SMMT).
This is the first time the UK has seen the production of one million vehicles since 2019 and has been heralded by automotive experts.
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The total retail value of all the models is worth more than £50billion
Last year was capped off by a successful December with car manufacturing up 20.7 per cent year on year and the volume of commercial vehicles rising by an impressive 80.3 per cent.
Over the course of 2023, a total of £23.7billion of private and public investment commitments were made to support manufacturing in the UK.
This represents more investment than the previous seven years combined including Cowley and Sunderland as well as the development of gigafactories and research and development facilities.
Mike Hawes, chief executive of the SMMT, said: “We are back in the game. With global competition as fierce as it has ever been and amid escalating geopolitical tensions, both Government and industry must remain singularly focused on competitiveness, with all the jobs and growth this will bring.
“We are in a much better position than a year ago, but the challenges are unrelenting.”
UK production of battery electric, plug-in hybrid and hybrid vehicles surged to 346,451 units, up 48 per cent on the year before to account for almost two-fifths of overall output.
The total retail value of all the models is worth more than £50billion thanks to a spike in foreign buyers with exports rising by 17.6 per cent.
Mark Tisshaw, editor of Autocar Business, said: “The record output of electrified vehicles combined with the billions of pounds worth of public and private investment commitments announced last year shows the UK has the potential to become a global leader in battery and electric vehicle technology, but this potential needs to be properly recognised and leveraged in Westminster.
“Interest in EVs among private owners is still not where it needs to be and it will be interesting to see whether manufacturers are prepared to lose money on each EV sold rather than face fines for missing the ZEV target.
“Whatever happens, the prospects for a successful future for automotive manufacturing in the UK will be greatly enhanced by long-term Government support, so manufacturers will be listening intently to policy commitments from the major parties in the run-up to the general election later this year.”
Similarly, Richard Peberdy, UK Head of Automotive for KPMG, said the boost in investment and production was a huge positive for the country, although some issues remain.
He said: “Higher interest rates have not only pushed up mortgage costs, but also the cost of car finance.
Electric vehicles have helped UK production rates rebound
“Insurance prices have also risen, amongst several higher outgoings that households face.
“This financial landscape is undoubtedly suppressing and changing consumer car buying decisions and that will continue until the squeeze of household finances loosens.”