Single market boosts UK car industry

Access to the single market has been a key factor behind the success of the UK car industry, its trade body has said, as it reported record turnover in 2015.

The Society of Motor Manufacturers and Traders (SMMT) said turnover rose 7.3 percent to £71.6 billion, while employment and vehicle production also grew sharply.

The number employed in the sector rose by 17,000 to 814,000.

The UK's future access to the single market has been brought into question following the vote to leave the EU.

SMMT chief executive Mike Hawes said that while the UK's automotive sector had "gone from strength to strength", this uncertainty presented serious potential problems for the car industry.

"The industry now faces new challenges. Uncertainty, economic instability and an undoubted impact in terms of cost, influence and ease of business," he said in a speech.

He said success has been due to unrestricted access to the single market, input to EU legislation to safeguard the interests of UK Automotive, and the ability to recruit talent from abroad.

He warned that any threat to this from leaving the union could jeopardise the ability to access important markets.

"We need full and unrestricted access to the single market now and in the future, 80 percent of what we produce is exported and the only way to succeed is through unrestricted and reciprocal access to the EU and global markets," he told an industry summit.

There was a 5 percent rise in vehicle production to 1.7 million in 2015, the SMMT said, and car manufacturing output is already up more than 10 percent so far this year.

Demand for both cars and commercial vehicles in the UK reached record levels in 2015, with 2.6 million and 420,000 registrations respectively.

Investment in research and development by the industry also reached a record high of £2.5 billion in 2015, representing around 12 percent of the country's total spending.