Let’s celebrate the UK car industry; bellwether for growth

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Fantastic news today that Jaguar Land Rover has hit a sales record for September, selling 47,634 cars globally. The sales boosted by the new Jaguar XE saloon, which has its engine built in the i54 site near Telford, Wolverhampton, show the continuing strength of the UK car industry, which should be celebrated.

In a period of negative automotive news generally with the Volkswagen emissions scandal and likely recall of millions of cars globally, the car industry, especially in the UK is in much need of good news. Jaguar Land Rover itself is still fighting back from the Tianjin explosion and fire in China in August, which wrecked nearly 6,000 cars. The destruction and damage to these vehicles will mean a one-off financial cost to Jaguar Land Rover probably in the tens of millions. It reminds us that for all the profits companies make, costs are always born. So the record September sales, up three per cent beating last year’s record September, will bring some welcome cheer. This is especially ture as so far this year, sales are up by 15% in the UK for Jaguar Land Rover.

These sales are also heartening for the jobs and the economic growth that they bring to the UK. Everyone is feeling the impact of China’s economic slowdown, including Jaguar Land Rover, where sales are down by 29%. But with increasing sales overall, they show a microcosm of how UK industry is pushing recovery on in spite of the chill from China.

This push to growth is reflected in jobs, with the Telford i54 site doubling in size to 700 jobs, a decision Jaguar Land Rover made in 2013. Decisions like these are to thank for the unemployment tally for the UK reaching a 7 year low to pre-crisis low of 5.4% or 1.77mn, as announced yesterday by the Office for National Statistics.

But this is unlikely to be a one off – more jobs in the car industry boosting employment and growth. In fact a report this week from the SMMT (the industry’s trade body) showed that the UK’s automotive industry will break the current record for vehicle manufacturing in 2020 to two million cars annually. This is because of a growing focus on high end premium cars, such as Jaguar land Rover’s XE saloon, which together with the all new Discovery Sport, retailed more than 13,000 vehicles this month.  In 2010, 37% of the UK’s car production was by ‘premium’ manufacturers, with that figure expected to rise to 54% by 2020. This is only second to Germany. All of this leads to more jobs, with this rise in production expected to deliver a further potential 9,500 jobs in car manufacturers and 28,000 jobs in related supply chains.

So a real opportunity to celebrate some good news for one of the UK’s core industries. But, more seriously and longer term, if the UK is going to rally against international economic winds and storms, not least from the likes of China; more good news from the car industry is going to be key.

 

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About the Author

About the Author: Crispin Oyen-Williams is the Director and Founder of Business Innovate. .

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