UK car production at lowest level since 1956 due to chip shortage

The ongoing semiconductor shortage continues to impact the global automotive industry, with the UK bearing the latest brunt of it.

According to vehicle production data from the Society of Motor Manufacturers and Traders (SMMT), this October was the lowest for car output since 1956 in Britain, owing to the supply shortage.

Compared to the same month last year, output dropped by 41.4 per cent, with 64,729 passenger vehicles manufactured throughout October 2021 – roughly 10,000 less than the number sold in Australia over the same period.

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It's been a tale of two years for the broader automotive industry, with COVID-induced shutdowns affecting production last year, while the delayed effect of the chip shortage has been hitting in 2021.

This is reflected in overall year-on-year production to the end of the 10th month, as the 721,505 vehicles manufactured in the UK so far this year equates to a drop of 2.9 per cent – mainly thanks to the tough October.

However, some aspects of the industry have grown, as the SMMT reports battery electric (BEV), plug-in hybrid (PHEV) and hybrid (HEV) vehicles accounted for 30.9 per cent of all cars produced in October.

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According to its data, fully-electric vehicle production alone increased by 17.5 per cent to 8454 units, bumping the annual number up to 50,000 – which is more than the whole 12 months of 2019.

For the second year in a row, the industry is unlikely to crack one million vehicles produced, although modelling suggests it could bounce back to 1.2 million cars per year by 2024 if the semiconductor shortage subsides.