Carmakers buck UK low productivity trend

The UK may be suffering a productivity crisis but its carmakers are bucking the trend and enjoying record output per worker.

The British motor industry produced an average of 11.5 cars and commercial vehicles per person per year over the period from 2010 to 2014, a record high, according to figures released by the SMMT industry body on Thursday.

That compares with an average of nine vehicles per person in the previous five years - which included a sharp fall in production during the financial crisis - and just three vehicles per person in the early 1980s.

Ten years on from the collapse of MG Rover, the export-focused automotive industry has become an unlikely star of the UK economy, producing more than 1.5m vehicles last year and attracting billions of pounds of investment from the likes of Tata Motors, owner of Jaguar Land Rover, and Nissan of Japan.

Britain has become the fourth-biggest vehicle maker in the EU and is more efficient than bigger producers such as Germany, at about seven vehicles per employee in 2012, and France, at about eight, according to figures from Acea, the European manufacturers' body. Spain, Europe's most efficient carmaker, produced almost 15 vehicles per person in 2012.

The UK's automotive success story comes against the backdrop of widespread concern about the country's dismal productivity record in recent years, with output per hour lagging behind the rest of the G7 leading nations by 17 per cent, according to the most recent official data.

Britain's car industry was an early adopter of the lean manufacturing methods brought to the UK by the likes of Toyota, Nissan and Honda in the 1980s - principles that have subsequently spilled over into other parts of the manufacturing sector and the wider economy.

More recently, high levels of innovation, new model development and investment in modern machinery have all helped boost efficiency in the car industry, said Lee Hopley, chief economist at the EEF manufacturers' organisation. "That all adds up to a pretty sweet cocktail for the productivity figures for that sector," she said.

Not only has productivity risen, but the wholesale value of cars exported from the UK has more than doubled in the past 10 years. This has been partly thanks to the global success of off-road-style models such as the Land Rover Evoque and the Qashqai, made at Nissan's plant in Sunderland - a facility that builds more cars each year than Italy and is widely considered the most efficient in Europe.

Car production data for March showed volumes up 2 per cent compared with the same month last year, helped by a rise in deliveries for the rampant domestic sales market.

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