Sunday, June 21, 2009

Car industry downturn bottoming out?

By David Bailey on Jun 20, 09 11:35 PM
in Automotive

New figures from the Society of Motor Manufacturers and Traders (SMMT) show that the number of cars assembled in the UK last month fell by 43% year-on-year. Dreadful as these figures sound, these are actually the best figures so far this year, and may suggest that the worst downturn ever seen in the car industry in the UK has bottomed out. We're NOT talking recovery, of course...

The same cannot be said for the commercial vehicle sector; here production fell by a disastrous 73.5%, with firms lacking the credit and confidence to buy vehicles.

Ever since demand fell off a cliff last autumn when the financial system imploded, car producers have rapidly scaled back output as stocks piled up. Part-time working, lay-offs and lengthy plant shut-downs have been the norm in the industry. With assembly plants shut down or on reduced shifts, the knock-on effect has been felt down the supply chain; the number of jobs lost in the industry runs to 30,000+ even excluding the LDV workers.

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