The UK motor industry “is weathering the global recession and beginning the long road to recovery”.
That was the upbeat message from Paul Everitt, chief executive of the Society of Motor Manufacturers and Traders, following the latest monthly vehicle productions figures.
They showed that, although car production fell again in June, the decline was the smallest so far this year.
UK plants produced 91,718 cars last month, 30.2 per cent fewer than in June 2008, the SMMT said.
It followed falls of 43.0 per cent in May and 55.3 per cent in April.
Production of vans, trucks and other commercial vehicles fell by 60.4 per cent last month but this was a smaller reduction than in May when output was down 73.5 per cent.
After predicting recovery, Mr Everitt went on to say: “As production volumes and registrations begin to stabilise, government must help to sustain consumer confidence and encourage banks to deliver the credit industry needs.”
Mr Everitt said the continuing slump in CV production “reflects the difficult economic conditions and fragile business confidence in key markets, particularly the road haulage and construction sectors”.
The Government’s car-scrappage scheme has helped boost production while the June figures were swelled by the resumption of production by Honda at its plant in Swindon, Wiltshire, following a four-month halt.
The June figures took the year-to-date car production total to 410,740 – a 50.2 per cent drop on the January-June 2008 total.
CV production is down 64.5 per cent for the year so far.
A Business Department spokesman said: “It is great to see that the scrappage scheme is delivering the boost to the sector it was designed for and that these figures show a decrease in decline.
“So far, orders under the scheme are reaching close to 122,000 since it was announced in April of this year. The scheme is time-limited and has a finite budget.
“Any consumers interested in taking part need to make their orders sooner rather than later.”
RAC motoring strategist Adrian Tink said: “It looks like the scrappage scheme is continuing to have a positive effect on the car manufacturing industry.
“The latest figures seem to indicate that new car production rates are beginning to stabilise and that the industry is weathering the current economic recession.
“However, while the scrappage scheme has undoubtedly provided much-needed support to manufacturers, the Government must continue to provide this in the long term. It would be a shame if the industry took one step forward and two steps back once the Government’s pot of money runs dry.
“Prolonged investment is necessary if we are to see a noticeable increase in the number of cleaner, greener and safer vehicles on the nation’s roads.”