UK Auto Production Falls Below One Million Amid EV Transition
In 2024, the UK’s vehicle manufacturing sector experienced a significant setback, with production dropping by 11.8% to a total of 905,233 units—a figure that marks the lowest output in five years. This downturn comes as the industry faces the dual challenges of shifting toward electric vehicles and confronting weakening global demand.
The decline is largely attributable to a 13.9% reduction in car manufacturing, which saw production fall to 779,584 units. In contrast, commercial vehicle production saw a modest increase of 4.0%, reaching 125,649 units—the highest level recorded since 2008.
Several factors contributed to the slump in car production. Manufacturers have begun phasing out established internal combustion engine models while retooling factories to accommodate the production of electric vehicles. Additionally, a slowdown in key export markets and broader economic uncertainties have weighed on overall consumer confidence.
The final month of 2024 was especially challenging, with December output plummeting by 27.1% to just 45,022 units, highlighting a persistent trend of contraction over ten consecutive months.
Despite nearly 78% of the cars produced being destined for export, international demand has been uneven. Exports to the European Union and China dropped by 24.3% and 21.8% respectively, while shipments to the United States experienced a notable 38.5% increase. The UK continues to rely heavily on these markets, with the EU, US, and China remaining its key export destinations, followed by Türkiye and Japan.
Production of electrified vehicles, including battery electric, plug-in hybrid, and hybrid models, also declined by 20.4% to reach 275,896 units. Even with this downturn, these vehicles accounted for more than one-third of the overall output, reflecting sustained investment in greener mobility solutions despite the disruptions associated with transitioning manufacturing processes.
More than £23.5 billion (approximately $30 billion) has been invested in the UK’s electric vehicle transition since early 2023. The industry remains optimistic about a rebound, with forecasts suggesting that car and light van production could rebound to 839,000 units in 2025 and potentially exceed one million units by 2028—rising further to over 1.1 million by 2030, assuming economic recovery and a swift increase in consumer adoption of electric vehicles.
Industry leaders are urging the government to accelerate a targeted industrial strategy for advanced automotive manufacturing. This plan should prioritize innovation, boost investment and skills, stimulate domestic demand, and secure favorable post-Brexit trade conditions. There is also a call for international trade agreements that secure tariff-free access to key markets and ensure the steady supply of critical minerals essential for EV production.
Without prompt and decisive government measures, experts warn that the UK could lose its competitive edge in the global electric vehicle arena—a shift that may have lasting effects on future growth, job creation, and the country’s progress toward its climate targets.
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