European Markets

Lowest October UK car output since 1956 amid chip shortage

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Vauxhall Astra vehicles are pictured on a production line at Vauxhall car factory in Ellesmere Port, Britain July 6, 2021. REUTERS/Phil Noble

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LONDON, Nov 26 (Reuters) - British car output fell by an annual 41.4% last month to its lowest October level since 1956 as the global lack of semiconductor chips and a plant closure hit the sector, according to a trade industry body.

A total of 64,729 cars rolled off British production lines, data from the Society of Motor Manufacturers and Traders (SMMT) showed on Friday.

The fall reflected the global supply chain problems and Honda's (7267.T) permanent closure of its factory in late July.

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Car output in the first 10 months of the year stood at 721,505 vehicles, down 2.9% on 2020 when sites were closed for months as the coronavirus pandemic hit Britain.

Full-year car and van output will be below 1 million for a second consecutive year but is expected to return to above that level in 2022, the SMMT said, citing an independent forecast by AutoAnalysis.

"Britain's automotive sector is resilient but with COVID resurgent across some of our largest markets and global supply chains stretched and even breaking, the immediate challenges in keeping the industry operational are immense," said SMMT Chief Executive Mike Hawes.

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Reporting by Costas Pitas Editing by William Schomberg

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