The UK Automotive Industry is remaining strong despite current economic uncertainty. With the future of the UKâS connection with Europe being negotiated the outlook for the global economy appears unsure. The UKâs exit of the European Union is seen as the biggest threat to the automotive industry.
Research released by Lloyds Bank Commercial Banking shows that despite the current market investments by manufacturers are still going ahead as planned. The study conducted by Lloyds is an annual occurrence and aims to understand the position of the sector today as well as plan for any complications in the future.
The research has revealed that investment in the Automotive industry is expected to remain at the 19% turnover over the course of the next two years. The study has also predicted a growth in turnover over the next two years as long as there are no unforeseen political or economic shocks. These shocks would then have the potential to harm supply and demand within the industry.
Lloydsâ study has uncovered that nearly 4 out of 10 businesses, or 39%, expect to see growth in their company due to new product development. Other businesses plan to increase their growth through the use of investments over the next two years. 29% of those who participated in the study suggested that the UKâs decision to leave the EU is one of the largest obstacles facing the sector over the next two years. The weakness of the sterling was also cited as a possible obstacle for automotive companies to negotiate.
Despite the gloomy economic forecast Automotive companies still plan on expansion, with 77 percent of firms asked expressed their interest in engaging with international customers, and are planning to invest in this expansion. 87% of manufacturers within the automotive industry intend on creating new jobs over the next two years. This has the potential of creating almost 85,000 new jobs if the results of the study were reflected across the entire sector.