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UK car output plunges to lowest level since 1950s

Thu, 30th Jul 2020 00:01

By Costas Pitas

LONDON, July 30 (Reuters) - British car production fell by
more than an annual 40% in the first half of the year to the
lowest level since 1954 as the coronavirus pandemic shut
factories and dealerships, an industry body said on Thursday.

Plants and retailers closed in March and only some gradually
began to reopen from May with certain sites still shut and
others not at pre-virus levels.

The hit leaves output at just over 381,000 cars, the lowest
level since 1954, when Winston Churchill's government ended food
rationing imposed as part of the World War Two effort.

In 2020, the industry expects to churn out just over 880,000
cars, a third lower than in 2019 in what would be the worst
performance for over 60 years, the Society of Motor
Manufacturers and Traders (SMMT) said.

"Our factories were once set to make two million cars in
2020 but could now produce less than half that number, a result
of the devastating effects of the pandemic on top of already
challenging market conditions and years of Brexit uncertainty,"
said SMMT CEO Mike Hawes.

But announced investment in the first half of the year rose
from 90 million pounds ($117 million) in 2019 to 485 million
pounds thanks primarily to Nissan, which is due to build its new
Qashqai in Britain.

Alongside the pandemic, the sector faces the challenge of
investing in electrification, the rapid decline in demand for
diesel models and is worried that Brexit could create trade
barriers with its biggest export market.

Some in the industry have sought a scrappage scheme, last
introduced in 2009, to protect jobs after thousands have been
shed in the last few months.

"We have a proposal," said Hawes. "We think we can arrive at
something which would be a net benefit to the Treasury."
(Editing by Stephen Addison)

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