Exports are expected to boost vehicle production in the UK in 2012 according to the Society of Motor Manufacturers and Traders (SMMT) and logistics providers are positioning themselves to make the most of the increase in business.
Car output increased by 5.8% in 2011 to 1.34m units according to figures from the industry body, with a record 84% of that figure shipped overseas. Europe is the biggest market, taking 60% of the exports led by Germany and Italy, but there is also strong demand in China, Russia, the Middle East and the US.
Exports of those vehicles increased 17% to 1.12m units in 2011 and this year are expected to grow in line with output.
According to the SMMT the big advantage is the exchange rate, which means that UK-made vehicles remain competitive.
Commenting on the figures, UK business minister Mark Prisk, said: ”The global vehicle market grew by around 4% in 2011. At the same time, UK vehicle production grew by nearly 6% demonstrating how the UK has out-performed the market this year.
“Exports of UK-made cars and commercial vehicles have also risen from 75% to over 80% of total production to meet this growing demand,” said Prisk.
Finished vehicle carriers operating in the UK have welcomed the increase in exports.
“With operator's margins lower than ever before, export traffic flows are vital to the sustainability of the automotive logistics network in the UK,” said Ray MacDowall, managing director of ECM (Vehicle Delivery Services).
ECM, the UK’s largest privately-owned car carrier, saw export traffic flows increase by a substantial 33% during the last 12 months, partly to a general increase in production from UK plants but also, as MacDowall made clear, due to ECM’s ability to win business by meeting tight lead-time requirements for plant clearance.
“With space at most UK plants being in short supply, when production increases it places a huge demand upon the carrier to shorten plant clearance times,” MacDowall told Automotive Logistics. “Often these can be as short as six hours worked on a 24/7 basis. These short lead-times, when coupled with such things as the unpredictability of release holds from parts shortages and quality reworks, means transport releases are often batched, thereby increasing the demand for flexibility within the haulaway process.”
MacDowall went on to explain that ECM has developed a fleet utilisation solution called Synergetic Automotive Transport System (SATS), which provides enough flexibility in the company’s daily operations to meet those demands whilst retaining operational efficiency.
The UK division of Gefco, which has just announced a new contract for distribution in the UK with Chevrolet, is also prepared to meet the increase.
Bertrand De Techtermann, GEFCO UK automotive director said the company was well prepared for the boost in export levels. Last year’s fleet renewal programme included the purchase of 17 new transporters which De Techtermann said confirmed Gefco’s position as one of the youngest and most versatile fleets in the UK.
“The newly-purchased transporters included nine models which were previously unavailable for UK transportation and allow a wide range of vehicle combinations to be transported in the same load,” he told Automotive Logistics.
De Techtermann went on to say that Gefco’s extensive European network and close-knit group of subsidiaries meant it had the capacity to increase transport volumes in line with customer business requirements.
“The ongoing increase in export levels, particularly between the UK and mainland Europe, represents a great opportunity for many of Gefco’s customers and the company is fully able to facilitate an increased service as required.”