UK car production up 8.6% in July as component shortages begin to ease

An employee works on an Aston Martin DBS at the company’s factory in Gaydon, Britain, March 16, 2022. Picture taken March 16, 2022. REUTERS/Phil Noble

Aug 25 (Reuters) - British car production rose for a third straight month in July, 8.6% higher than a weak comparative last year, when car makers were struggling with acute shortages of chips and COVID-related absences, the Society of Motor Manufacturers and Traders (SMMT) said on Thursday.

The industry body said 58,043 units were made in Britain last month, up from 53,438 in July 2021, but the output remains 46.4% below pre-pandemic levels as the industry struggles with supply chain shortages, structural changes and weak exports.

The crisis in Ukraine, a major hub for automotive parts, as well as lockdowns in China and severe parts shortages have hurt car production in the United Kingdom.

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"A third consecutive month of growth for UK car production is, of course, welcome and gives some hope that the supply chain issues blighting the sector may finally be starting to ease," SMMT Chief Executive Mike Hawes said.

"But other challenges remain, not least energy costs which are increasing at alarming rates."

However, shipments continued to drive the sector, accounting for eight out of 10 cars made. Exports to top markets – the European Union and the United States – fell 7.3% and 22.8%, respectively. Orders from China were up 54%, while they rose 40.1% for Japan.

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Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Shailesh Kuber

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