UK vehicle production fell sharply in July, although the latest manufacturing figures contained a significant piece of positive news for electric and hybrid cars.
British factories produced 63,655 cars and commercial vehicles during July 2026, down 11.6% compared with the same month last year.
New figures published by the Society of Motor Manufacturers and Traders on Thursday, 27 August show weaker exports were one of the main factors behind the decline.
Total vehicle exports fell 15.9% to 47,377 units, while production for the UK market increased 3.8% to 16,278 vehicles.
Car manufacturing accounted for the overwhelming majority of production, with 61,767 cars leaving UK factories during the month.
That represented a 10.6% year-on-year fall, despite production for British customers increasing by 9.3%.
Exports of UK-built cars fell 15.8%, with shipments declining across all of the country’s major overseas markets.
Exports to the European Union were down 15.2%, while shipments to the United States fell 17.7%. Turkey was down 18.5%, Japan 24.4% and China 36.9%.
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There was considerably better news for electrified vehicle manufacturing.
Production of fully electric and hybrid cars increased 6.8% to 25,678 vehicles, marking the first monthly rise in electrified production recorded during 2026.
More than four in every ten cars manufactured in Britain during July were either fully electric or hybrid, compared with around three in ten during July 2025.
Commercial vehicle manufacturing experienced a much steeper decline, falling 34.4% to just 1,888 vehicles.
Output of commercial vehicles for UK customers was down 49.6%, while export production fell 18.5%.
Across the first seven months of 2026, UK factories produced 449,634 cars and commercial vehicles, an 8.1% reduction compared with the equivalent period last year.
The SMMT says the figures reflect a combination of model changeovers, the closure of a manufacturing plant last year, weaker overseas demand, investment uncertainty and differences in the timing of routine summer factory shutdowns.
An independent production outlook nevertheless expects UK car and light commercial vehicle manufacturing to remain broadly stable across the whole of 2026 at around 740,000 units before returning to growth in 2027.
The SMMT also highlighted the Government’s recently launched review of the Zero Emission Vehicle Mandate, arguing that reforms are needed alongside action on high industrial energy costs and future UK-EU trading rules.
UK automotive manufacturers are also preparing for tougher rules of origin under the UK-EU Trade and Cooperation Agreement from January 2027, while the industry has raised concerns about potential European “Made in the EU” measures.
For drivers, the most interesting part of July’s figures may be the change in the type of cars Britain is building. Overall production fell, but electric and hybrid manufacturing moved in the opposite direction and now represents a substantial share of UK car output.
Whether that improvement develops into a sustained trend will become clearer over the remainder of the year as manufacturers complete model changes and production of newer electrified vehicles increases.
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