UK car production fell by 17% in February compared with the same month last year, according to the Society of Motor Manufacturers and Traders (SMMT). The industry described the slump as “extremely worrying” and warned that further declines are expected in March following the Iran war, which has driven up global energy prices and weakened consumer demand.
Exports dropped sharply, with shipments to the US falling 34% and to China plunging 66%, while exports to the EU rose 5%. Overall exports were down 12%. UK carmakers export 81% of the vehicles they produce, making them vulnerable to trade tensions and shifting demand in key markets.
Production of battery-electric, plug-in hybrid and hybrid vehicles fell by 3% to 26,629 units, though they still accounted for 40% of total output. The SMMT warned that the conflict in the Middle East adds further strain to supply chains already under pressure from post-Covid disruptions.
Mike Hawes, chief executive of the SMMT, said: “Another decline for UK vehicle production and exports is extremely worrying, given these figures pre-date the crisis in the Middle East. While the sector has made efforts to build resilience into its logistics and supply chains post-Covid, the conflict adds further strain.”
The downturn contrasts sharply with Labour’s target of 1.3 million vehicles per year by 2035, nearly double the 764,715 cars and vans produced in 2025. The SMMT also warned that European sales could suffer if the UK is not fully included in new “Made in Europe” manufacturing rules proposed by the EU, which could threaten Nissan’s Sunderland plant, Britain’s largest car factory.
