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UK car production continues to soar

The performance of the UK car industry continues to exceed all expectations with production rising steadily. This almost un-British record of continuous success saw 160,854 vehicles built in the UK during October, a rise of 17.4% on the same month last year. Figures released by the Society of Motor Manufacturers and Traders (SMMT) confirmed the rise and gave a running total for the first ten months of the year of 1.28 million cars.

The performance of the UK car industry continues to exceed all expectations with production rising steadily. This almost un-British record of continuous success saw 160,854 vehicles built in the UK during October, a rise of 17.4% on the same month last year. Figures released by the Society of Motor Manufacturers and Traders (SMMT) confirmed the rise and gave a running total for the first ten months of the year of 1.28 million cars. This represents an increase of 5.4% on the same period last year. The October rise with the biggest single month increase of 2013 so far.

The figures also look promising for the wider UK economy. Around 80% of all UK produced cars are exported. This is great for the balance of payments but it actually says more about the economic wealth of the countries who are buying the cars. These countries are typically the emerging economies like Russia, China and India, who have developed a taste for luxury British built cars. A closer look at the SMMT figures, however, reveals some good news for the domestic market. Cars built in the UK to be sold in this country increased by a stunning 52%. Exports, while already strong, increased by 11.4%. The large increase in production for the home market reflects increasing consumer confidence, which in turn leads to increased spending on these big ticket items.

Mike Hawes, SMMT chief executive, commented: "UK car manufacturing for the home market increased strongly in October. More than 15 brands build 50-plus models of car across the UK with volume and niche offerings providing a wealth of choice for our home and export markets. With European demand showing early signs of recovery, we expect production to continue positively in the coming months."

The news on commercial vehicles is, however, less positive. Production was 7,825 for October, which is 33.8% down on the same month last year. Figures for the year to date are also down, showing a 19.9% drop at with a total of 75,484 vehicles. Mr Hawes responded: "The downward trend in commercial vehicle production continued in October, given continually low levels of demand across the EU combined and structural and model changes in the UK. Despite some areas of good news, with UK bus and truck manufacturing growing in the month, the domestic commercial vehicle manufacturing outlook remains negative for the rest of the year."

Engine production, meanwhile, rose by 6.5% to 254,480 during October. The year to date total is 2.17 million, an increase of 2.4% on last year.

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