With all politics, debate, and uncertainty surrounding the United Kingdom leaving the European Union (EU), the country’s economy remains to be among the biggest sufferers. In an earlier article, we discussed how the British economy is facing setbacks as a direct consequence of Brexit and this time it is about car production industry that has suffered the wrath. As per April data, units of produced cars have fallen by nearly half as manufacturers made radical adjustments in order to manage the aftermath of 29th March Brexit- that did not happen.

After the country’s failure to reach a consensus and sign exit deal, the UK government has been able to buy some more time from the EU by pushing Brexit date until the end of October, this year. But it did not have a great impact in terms of reversing onslaught on the national economy. Manufacturers across industries have decreased or ceased production.

This April is an 11th consecutive month for output to have a downward trend in the UK. According to data revealed by the Society of Motor Manufacturers and Traders (SMMT), the total number of cars manufactured in April has been 70,971, while 127,971 car units rolled off production lines during April, last year. This indicates a massive fall of over 44% in car production. Among companies that initiated shutdowns during April included Honda, BMW, Jaguar, Vauxhall, and few others.

Nissan earlier announced its plan to move the latest SUV model production facility from Japan to the United Kingdom, but amid Brexit fiasco, the company is said to have reversed its decision. Similarly, Honda is gearing up for an England-based production plant closure.

U.K’s car manufacturing industry relies heavily on just-in-time (JIT) supply chain system which ensures quick delivery from other European countries. The supply chain system seems to be at risk in the post-Brexit scenario, and it is a major factor that has contributed to plaguing this industry.

The SMMT Chief executive, Mike Hawes, mentioned in a press release that Brexit-related cost and uncertainty has been a major factor behind such devastating figures. Hawes believes that the risk of ‘no deal’ Brexit has been holding back economic progress and hindering investments, which has resulted in the loss of jobs and weakening global reputation.

However, the SMMT is hopeful for production stagnation to ease by the end of the current year if the UK is successful in ensuring a ‘favorable deal’ as it would ease a majority of existing trading tensions.