UK car sector stalls on COVID, semiconductor shortage

Britain’s car manufacturing stalled last year on pandemic fallout, including a semiconductor shortage, despite record demand for greener electric vehicles, industry data showed on Thursday.

The nation’s mainly foreign-owned carmakers produced 1.65 million vehicles in 2021, the Society of Motor Manufacturers & Traders (SMMT) said in a statement. That was up just one per cent from 2020 – but almost 29 per cent lower than the market’s pre-pandemic level in 2019.

“It’s been another desperately disappointing year for the car industry as COVID continues to cast a pall over any recovery,” SMMT chief executive Mike Hawes said in the statement.

The SMMT has predicted a recovery to 1.96 million cars for this year, but the forecast predates the arrival of the Omicron coronavirus variant in late November.

The pandemic erupted in early 2020 and has ravaged demand for new vehicles, while the market has also been impacted by a supply-chain crunch. Global car output has been held back by a worldwide shortage in computer chips, which are vital components in all types of vehicles.

The UK car industry is also grappling with trade fallout from Britain’s exit from the European Union at the start of...