Bad news on UK vehicle manufacturing arrived just after this blog’s Christmas shutdown. A worsening slump in export demand caused UK commercial vehicle manufacturing volumes to fall by 34.6% in November.

According to the latest figures from the Society of Motor Manufacturers and Traders (SMMT), 6,312 vans, trucks, buses and coaches left UK production lines in November, compared to 9,649 in November 2016.

Home demand continued to fall but the rate at which exports are declining has almost doubled since September:

UK CV manufacturing output November 2017 (source: SMMT)

Perhaps unsurprisingly, SMMT chief executive Mike Hawes believes uncertainty over Brexit is one of the reasons for the decline in domestic demand:

“November marks the ninth month of negative growth for UK CV production in 2017. Whilst fleet purchasing cycles have fluctuated, declining confidence among operators in the CV market is no doubt affecting production. To stimulate demand and safeguard the competitiveness of our industry, we need urgent clarity on transition arrangements and the nature of our long-term future relationship with Europe.”

Mr Hawes failed to comment on the far more severe reduction in export demand. This seems all the more worrying to me because exports’ share of production rose from 57.7% to 62.1% during the first 11 months of 2017. I’d imagine that if volumes decline much further, excess production capacity could become problematic.

As the graph below illustrates, total CV output fell sharply last month to levels not seen since late 2014/early 2015:

CV output rolling year Nov 2009 – 2017 (source: SMMT)

It’s not yet clear whether this sudden slide will be a one-off correction or the start of a new trend. Let’s hope it’s the former and that fleet orders will rise as we head into 2018.