Car production in the UK has hit a historic low, with manufacturers producing just under 780,000 vehicles in 2024, marking a 14% decline from the previous year. Industry experts predict another drop in 2025, which could bring production levels to their lowest since 1954. Major automakers, including Nissan and Jaguar Land Rover, have struggled with weakened demand and ongoing challenges in shifting toward electric vehicles (EVs).
A key issue for the industry is the slow adoption of EVs among private buyers. While corporate and fleet sales have driven record EV adoption, the government’s removal of a plug-in car grant in 2022 has dampened consumer demand. Automakers have had to rely on heavy discounting—amounting to £4.5 billion in 2024—to boost EV sales, a practice that industry leaders warn is unsustainable. Jaguar Land Rover’s decision to pause Jaguar production until 2026 to reposition itself as a luxury EV brand has also contributed to the industry’s production decline.
Industry leaders are calling for greater government support, including incentives for private EV buyers, to help stabilize the market. With automakers retooling their plants to meet future EV demand, the UK’s automotive sector is in a transitional period. While production is expected to recover in the long term, the immediate outlook remains challenging, with the industry looking to policymakers for solutions to boost confidence and encourage new vehicle purchases.
