The automobile market in the United Kingdom

The automobile market in the United Kingdom currently ranks as the fourth largest in Europe in terms of production, following Germany, Spain, and France. In 2017, the UK's automotive industry boasted a turnover of £82.3 billion, contributing £21.7 billion to the country's economy. Major volume car manufacturers are predominantly of foreign origin: Nissan Motor UK, Honda UK, Toyota UK, and Vauxhall Motor UK, a subsidiary of Opel AG. Moreover, 18 of the world's top 20 automotive suppliers have operations in the UK. The sector alone accounts for 4% of GDP and shows promising growth prospects for the years ahead, with the French market share standing at 17%.

Key Facts of the UK Automobile Market

The UK automobile market is currently the second-largest in the European Union and the second-largest producer of premium vehicles after Germany.

• In 2017, the UK produced 1,682,156 cars and commercial vehicles, as well as nearly 2.6 million engines.
• 81% of these vehicles and 60% of these engines were sold for export.
• That same year, sales reached 2.5 million units.
• The country is the fourth-largest producer of construction machinery (off-road vehicles), producing approximately 60,000 units per year.
• Productivity has significantly increased, with average gross value added (GVA) per employee reaching £75,000 between 2010 and 2013, compared to £40,000 in the late 1990s.
• The main companies in the automotive industry are located in the Midlands region.
• British car manufacturers have been recognized nationally and internationally for the quality of the cars and engines they produce (Range Rover, Mini, McLaren, Ford EcoBoost engine, etc.).

The Prosperous UK Automobile Market

In 2017, the number of UK car registrations increased by 3.9%. The country is currently benefiting from new models and very affordable financing conditions, leading to a thriving automobile market in the UK.

• The Midlands region received a £50 million investment in the creation of an industrial zone dedicated to the automotive sector next to Coventry.
• In 2014, Rolls-Royce and Bentley had their best year ever: the former produced 4,063 cars, and the latter sold 11,020 vehicles.
• British companies invest approximately £1.7 billion in R&D every year.
• Sales to emerging countries are increasing: exports of English cars to China, for example, increased sixfold between 2008 and 2013.
• Vehicle sales have now returned to pre-crisis levels, with over 1.5 million vehicles sold last year.
• By the end of 2015, over 282,000 light commercial vehicles are expected to be sold in the UK. This represents a 1.8% increase compared to 2014.

Opportunities for Foreign Subcontractors

The British automotive industry has already established production plans for the next ten years, heralding significant opportunities for subcontracting in the automotive sector. The UK automobile market thus offers multiple opportunities.

• Vehicle production is expected to reach 2 million units in 2018, a record level in terms of yields.
• The British foundry industry has also returned to its pre-crisis production level and is regaining orders with partners worldwide.
• The increase in the number of original equipment manufacturers has created opportunities for companies looking to invest in the supply chain. Indeed, these manufacturers plan to purchase an additional £3 billion worth of components produced in the UK compared to 2017.
• Nearly a third of British metallurgical companies plan to expand through mergers and acquisitions in the next two years.
• By 2022, the British mechanical industry will need to recruit 2.56 million people due to the growth experienced by its automotive industry since 2013, thus offering opportunities for foreign subcontractors.
• Autonomous cars are allowed to operate in England. This market is estimated to reach a turnover of €1.2 trillion by 2025, according to the British government.
• The electric vehicle market is expanding rapidly (1% of total sales), and hydrogen vehicle production has just begun.

How Expandys Can Assist You

We can assist you with:

• Meeting potential clients.
• Identifying industrial and commercial partners.
• Selecting subcontractors.
• Undertaking all necessary procedures for the creation of your subsidiary in conjunction with the British tax administration and the financial institutions of your choice, and if necessary,
• Hosting your subsidiary in our premises to optimize costs.
• Managing your subsidiary by outsourcing your administrative, accounting, and financial procedures: Administrative and accounting management, Social and human resources management, End-of-year accounting operations, Legal management, Financial management.
• Supporting your efforts in the commercial development of your subsidiary.
  
  

  Discover how to effectively penetrate the UK automotive market with our expertise