Car production continues to lead manufacturing recovery, says KPMG
John Leech, head of automotive at KPMG, comments on the SMMT car production figures:
“The UK auto sector continues to power ahead as car production rose again by 23.5% in February compared to a year ago. This trend is being supported by export-led growth from the emerging markets through premium car manufacturers.
“Recent announcements of major investments by Jaguar Land Rover and Nissan have instilled further confidence into car manufacturing companies in the UK and their supply chains. We expect further volume gains in the months ahead. However, a major concern for many car companies is around the availability of skilled engineers. Debt and equity finance which at the moment is constrained is also becoming a worry for the industry.
“In light of these concerns, next week’s UK Budget will be watched very closely by the manufacturing sector. What will support manufacturers in the UK is private sector investment in research and development, a freeze on business rates and a focus on skills development in innovation and technology. Above all, manufacturers expect and want more ‘above the tax line incentives’ which can be more widely accessed by the industry than the anticipated package of corporation tax breaks.”
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KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with nearly 11,000 partners and staff. The UK firm recorded a turnover of £1.6 billion in the year ended September 2010. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 150 countries and have more than 138,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.