UK Car Production at 65-Year Low Amid Chip Shortage

UK car production dropped by more than 40 to the lowest level recorded for October since 1956 amid a global lack of semiconductor chips and disruptions caused by the COVID-19 pandemic.

The Society of Motor Manufacturers and Traders (SMMT) said that the decline was due to a “global shortage of semiconductors which led to production stoppages”, exacerbated by the closure of a highly productive Honda plant in Swindon.

British factories turned out 64,729 vehicles on October, a figure down by 41.4 percent from the previous month.

“These figures are extremely worrying and show how badly the global semiconductor shortage is hitting U.K. car manufacturers and their suppliers,” said SMMT CEO Mike Hawes.

Disruptions caused by the COVID-19 pandemic had created shortages in semiconductors, putting pressure on carmakers as they compete with tech and electronics industries for supply.

Engine production had fallen nearly 35 percent in October in its fifth consecutive month of decline due to chip shortages.

Meanwhile, production of battery electric, plug-in hybrid and hybrid vehicles comprised 30.9 percent of all cars made in October, having increased by 17.5 percent in a month as the industry continues to shift away from gas-powered cars.

“U.K. car makers have produced more than 50,000 zero emission vehicles, exceeding the total built in the whole of the pre-pandemic 2019,” SMMT added.

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