Car manufacturing ‘paralysed’ by no-deal Brexit threat as output drops for ninth straight month

British car manufacturing suffered its ninth consecutive month of decline in February, as the industry continues to suffer from Brexit uncertainty and plummeting demand in China.

Car makers produced 123,203 vehicles last month, according to the Society of Motor Manufacturers and Traders (SMMT), a drop of 15.3 per cent on the same period last year.

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Production for home markets dropped 11 per cent, but even more concerning for British manufacturers will be the continued stagnation of key markets abroad.

The number of cars produced for export dropped 16.4 per cent, with exports to the important Chinese market dropping more than half (55.6 per cent).

Meanwhile production for European Union countries, Britain’s combined biggest customers, fell 14.9 per cent.

Mike Hawes, SMMT chief executive, said the ninth consecutive month of decline signalled a “wake up call for anyone who thinks this industry…could survive a no-deal Brexit without serious damage.

“Uncertainty has already paralysed investment, cost jobs and damaged our global reputation,” he said.

The industry is “already challenged by international trade hostilities, declining markets and technological disruption,” he added.

Although exports have declined significantly in recent months, overseas demand continued to drive output, still accounting for nearly eight in 10 cars produced, with more than half of these destined for the EU.

“This underlines the importance of securing a truly free and frictionless trading relationship with our most important trading partner,” said the SMMT in a release.

Earlier this month, in a rare piece of good news for the industry, Toyota said it will produce a new model for Suzuki at its plant in Derbyshire.

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But Toyota has also warned a no-deal Brexit would result in “stop-start” production at the plant, and both Honda and Nissan have this year announced plans to eventually desert the UK.

Credit ratings agency Moody’s said earlier this month the profits of British, Japanese and German car manufacturers would suffer in the event of ano-deal Brexit due to tariff increases.