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United Kingdom Autos Report Q3 2008Published by: Business Monitor International Published: Aug. 18, 2008 - 45 Pages Table of Contents
AbstractThe UK automotive industry has seen some significant investment in addition to production cuts in the context of the economic slowdown in the UK. However, as BMI illustrates in the latest UK Automotives Report, the UK retains its position as a preferred manufacturing hub for some auto manufacturers, despite the shifting of most production units to Central and Eastern European countries.After almost two months of robust demand in the industry, registrations fell by a modest 3.5% in May, leading to a marginal decline of 0.6% in the first five months of 2008, according to estimates from the UK automobile manufacturers’ association SMMT. This is a clear indication of the economic uncertainty which is now beginning to hurt consumer demand and therefore vehicle sales. BMI expects the fall in consumer confidence in 2008, combined with tighter lending controls and the impacts from the credit crisis, to place pressure on new car sales during the remainder of the year. In view of the existing environment, BMI maintains lower vehicle sales forecasts for the UK at 2.37mn units by the end of 2008. However, car makers such as Nissan have once again shown their confidence in the UK as a highly competitive manufacturing base. As such, it has announced an investment of GBP5mn in its existing plant in Sunderland for the production of its new compact sports utility vehicle (SUV). General Motors’ UK subsidiary Vauxhall is looking to build its next generation Astra at its Ellesmere Port plant near Liverpool, while at the same time cutting down on the production of as many as 3,000 Astra cars from its annual production targets for 2008. The production cuts come as a part of the parent company’s Europewide strategy to cut costs in light of the economic downturn in the whole of Western Europe. As the industry becomes increasingly globalised, key industry players are coming up with international partnerships for mutual benefit. A case in point is the completion of the Jaguar-Land Rover deal between India’s Tata Motors and US Ford Motors. The deal is significant for Tata Motors as it provides a global reach and access to new technology, whereas Ford used the deal to raise some much needed cash for its struggling main brand business. Dutch luxury sports car maker Spyker and Britain’s Lotus Cars have also entered into a co-operation agreement to share parts and technology. The UK market saw the launch of Hyundai i10 in May, which remained the best selling model in the mini vehicle segment, where registrations increased by as much as 120% in May. The current market conditions seem to be favouring the diesel market, with Volkswagen’s Golf remaining the favourite choice among customers up to May 2008. On the whole, Ford maintained its lead on the market, selling 156,667 units during January-May, despite reporting a fall in sales, followed by Vauxhall with sales of 143,206 units. The third-best seller in the market was Volkswagen, with sales edging up by 3.31% yearon- year (y-o-y) to 85,217 units. Get Full Details About This Report >> |
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