Car production rose in March for the first time in a year with almost half of output EVs - but 'trade uncertainty' is now the 'major challenge'
UK car factories recorded a first increase in outputs in 12 months as March saw an 18.2 per cent rise in passenger vehicle production, official figures show.
Some 79,018 motors came off British assembly lines last month, which marked the first year-on-year increase in car manufacturing since February 2024.
Trade body bosses said the uplift in outputs was partially due to a 'weak' March in 2024 as it pointed to first-quarter production being 3.2 per cent down on where it was this time last year.
Notably, of the 79k cars made in Britain in March, 31,661 were EVs. That means almost half (45 per cent) of outputs are battery powered as UK manufacturers continue their transition to electric vehicles. A year ago, just 38 per cent of new cars made here were EVs.
Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, said attention for UK car makers will now focus on how they will adjust to Donald Trump's 25 per cent tariffs on all vehicles imported into the USA.
He said 'navigating the new era of trade uncertainty is now the major challenge' for Britain's automotive manufacturing sector.
Car production rose in March for the first time in a year - and almost half of outputs were electric. But the trade body hasn't celebrated the uplift, instead focusing on 'trade uncertainty' following Trump's 25% import tariffs, which it described as a 'major challenge' for the sector
The notable jump in car outputs was driven by 'robust demand' from overseas markets, with 73.3 per cent assembled cars in March exported - a rise of 30.6 per cent on foreign deliveries in the same month of 2024.
Mainland Europe was again the UK’s biggest importer and accounted for 57.2 per cent of total exports, up 28.9 per cent year on year.
The Americas, in the month before Trump's punishing import tariffs were announced, was the second biggest export market, accounting for more than one in seven models (15 per cent) shipped - which was up by more than a third on last March.
Given these figures reflect the level of US appetite for UK-made cars before the tariff announcement, the SMMT said manufacturers face 'considerable uncertainty' once US demand likely weakens, with knock on effects on other markets and the supply chains.
Some 79,018 motors came off British assembly lines last month, which marked the first year-on-year increase in car manufacturing since February 2024
Trade body bosses said the uplift in outputs was partially due to a 'weak' March in 2024 as it pointed to first-quarter production being 3.2% down. Nissan's Sunderland plant (pictured) is the biggest producer but the Japanese brand faces its own struggles
'Trade discussions must continue at pace to reach a deal that supports jobs, demand and growth on both sides of the Atlantic,' the industry rep said.
'Increased protectionism and retaliatory tariffs being levied in key markets mean a rapid response from government is needed, given the immediate challenges facing the industry’s exports,' it continued.
'It is also essential the UK does all it can to assure its longer term production competitiveness.
'Industry looks ahead to the comprehensive industrial strategy, due before the summer, which must have automotive and advanced manufacturing at its heart, and set concrete measures that support the growth of Britain’s most valuable goods export industry.'
'Trade discussions must continue at pace to reach a deal that supports jobs, demand and growth on both sides of the Atlantic,' the SMMT said on Friday
More than one in seven exported models in March were shipped to America, which is the second largest overseas market behind Mainland Europe. Pictured: Nissan car terminal at the Port of Tyne
The latest independent outlook – compiled ahead of rapidly changing trading conditions with the US - estimates that car and van production will fall by 7.8% in 2025 to 818,200 units. Pictured: Mini's Plant Oxford factory
Share this article
Hawes has long been rallying for the Government to introduce EV incentives to kickstart EV appetite as public demand for battery cars has waned badly and car companies have been forced to swallow £4billion in discounted pricing to encourage sales in the last year.
But his attention has now shifted to encouraging further trade negotiations with the US President.
'A March uplift to manufacturing is overdue good news, although the performance was boosted by a comparatively weaker month last year, when holiday timings and product changeovers combined to reduce output,' he said in Friday's statement.
'With the last quarter showing demand for British-built cars rising overseas, navigating the new era of trade uncertainty is now the major challenge.
'Government has rightly recognised automotive manufacturing’s critical role in Britain’s export economy and must now show urgency and creativity to deliver a deal that supports our competitiveness, spurs domestic demand for the latest cleanest vehicles, and helps factory lines flourish.'
The latest independent outlook – compiled ahead of rapidly changing trading conditions with the US - estimates that car and van production will fall by 7.8 per cent in 2025 to 818,200 units, before rising slightly by 1.2 per cent in 2026 to 827,700 vehicles.
With a favourable government strategy, however, this could rise to 834,900 units and set the industry on the path for further growth, the trade body said.
It comes amid reports that the UK Government is considering lowering import tariffs on US cars to just 2.5 per cent in an effort to broker a deal with Trump.
Paul Barker, Editor at Auto Express, said the reduction would make American-made cars - including the Ford Mustang and BMW X5 - cars but also raises 'serious questions about the resilience of the UK car industry'.
He said: 'It's vital we see a deal to stave off the punitive tariffs UK car makers are facing. But if the Government pushes too hard and fast for a deal with the US -particularly under an unpredictable Trump presidency - there's a real risk we could see UK-based manufacturing further weakened.
Official manufacturing figures come a day after Nissan - Britain's largest car producer - announced it expects to make £4billion net losses for the fiscal year as it embraces drastic cost-cutting measures to save it from the brink of collapse.
It looks certain to be the company's largest ever loss and comes as its new CEO is expected to lower the axe on thousands of global jobs, reduce production capacity and shutter some of its vehicle plants.
It has yet to rule out closing its Sunderland factory as part of its restructure.
The plant - which employs around 6,000 people in the North East - built a total of 282,124 units. This output represented more than one in three (36.2 per cent) passenger cars made in UK factories in 2024.
[52].png)
