UK vehicle production dipped below one million units in 2024 as the switch to EVs and “intense market pressure” took their toll.

Commercial vehicle production grew by 4.0% – reaching its best level since 2008 – but car volumes fell 13.9%

Factories turned out 779,584 cars and 125,649 commercial vehicles, totalling 905,233 units and down 11.8% on 2023, according to new data from the Society of Motor Manufacturers and Traders (SMMT).

Commercial vehicle production grew by 4.0% – reaching its best level since 2008 – but car volumes fell 13.9%, with output for the UK market down by 8.0% to 176,019 units, while exports declined 15.5% to 603,565 units.

The SMMT said car output was hit by the end of production for some long-running models as factories retooled for EVs, combined with weakness in key global markets, and a slowdown in the transition to electrification amid tough economic conditions.

Volumes of battery electric (BEV), plug-in hybrid (PHEV) and hybrid (HEV) vehicles to 275,896 units, down 20.4% on the year before but still accounting for 35.4% of overall output and the second highest on record.

The SMMT said the decline was expected, given the wholesale transformation underway at many car factories, and temporary. Carmakers announced more than £20bn worth of investment in 2023 and a further £3.5bn in 2024 to drive the UK’s transition to EV production.

Mike Hawes, SMMT chief executive, said: “Growing pains are inevitable, so the drop in volumes last year is not surprising. With new, exciting models and battery production on the horizon, the potential for growth is clear.”

The latest independent production outlook expects UK car and light van production to be around 839,000 units in 2025 before rising to 930,000 units in 2027, with the potential surpass one million cars and light vans in 2028 if markets improve and model launches stay on track.

But Hawes warned that EV production growth requires the Government to fast-track industrial and trade strategies for automotive manufacturing.

The SMMT is calling for market regulation that “reflects the reality of natural demand” – referencing the current consultation on the ZEV mandate – along with a fiscal framework that incentivises consumers to buy EVs.

Other requests from the industry body include an “ambitious trade strategy that maintains a tariff-free enhanced trade partnership with the EU, and balanced, commercially meaningful trade agreements and critical minerals agreements with existing and new trading partners”.

The right strategies will, according to the group, help secure the sector’s position as a £100bn global trade hub, with the potential to deliver £50bn in UK growth over the coming decade.