Tsunami effect is driving down the numbers of cars being built in UK

The outlook for Britain's motor industry is "extremely good" despite a slump last month in the number of new cars built, the sector's trade body yesterday insisted.

The number of new cars built in April fell 12 per cent compared with the same month last year, according to the Society of Motor Manufacturers and Traders (SMMT), which blamed the knock-on effect on production from March's devastating Japanese earthquake.

But it also reported that overall car output was 7 per cent higher in the first four months of the year than in the corresponding period in 2010.

The figures were published less than a fortnight after it was revealed that new car sales fell in April, the tenth successive monthly decline.

New car registrations reversed nearly 10 per cent in Scotland last month, the Scottish Motor Trade Association noted, part of a 7.4 per cent UK-wide fall.

The SMMT reported yesterday that just over 86,300 cars were built last month, down 12.2 per cent from April 2010, while new commercial vehicle numbers fell by nearly a fifth to 8,633 and engine manufacture dropped 4.7 per cent to 190,131. Total vehicle production over the month was 13 per cent lower than a year ago, dragging the year-to-date increase down to 5.8 per cent.

More than four-fifths of the 443,536 cars built since the start of the year were for the export market, noted the SMMT. The export rate is up almost a quarter since the start of the year, despite edging up just 1.7 per cent in April.

But car manufacture for the domestic market was down by more than half in April to 12,678 and has fallen by 35 per in the year to date.

Last month also saw a 25 per cent dive in the number of engines made for the UK market, but total engine production remained 6 per cent up over the first four months of the year.

The lower car output figures for April were attributed largely to disruption to the industry caused by the Japanese earthquake and tsunami, which has hit the UK operations of Japanese car-makers including Honda and Toyota.

Paul Everitt, chief executive of the SMMT, said: "April's vehicle and engine production figures reflect the global production challenges resulting from the Japanese earthquake. Output was down across the car, commercial vehicle and engine sectors as parts shortages interrupted regular manufacturing schedules.

"All manufacturers are working hard to overcome supply shortages and we expect any downturn to be short-lived. The outlook for the UK motor industry is extremely good and this should generate new opportunities for vehicle manufacturers and suppliers," he added.This month's new car sales data showed that 11,585 vehicles were driven out of Scottish showrooms last month, down from 12,825 in April 2010, while the UK total fell to 137,746 from 148,793 a year earlier.