Across the European Union the car manufacturing market continues to go from strength to strength. Recent figures from the Association of European Carmakers demonstrate that in spite of a number of headwinds, the sector remains strong and is almost at pre-economic crisis levels.
On the other hand, these figures also highlight that while 2016 was a particularly good year for car registrations in the UK, as a nation we are falling behind a number of our European counterparts.
When considered at a more granular level, figures from the Society of Motor Manufacturers and Traders (SMMT) confirm the car manufacturing market in the UK has experienced a drop in registrations of 8.5% in May and 4.8% in June.
This is perhaps unsurprising when you consider the uncertain economic and political environment in which the sector has been operating.
Indeed, our SME Growth Watch research, developed in conjunction with the Centre for Business and Economics Research, found that a third (33%) of SMEs in the transportation and distribution sector identified economic uncertainty as one of the most apparent barriers to growth – only topped by competition within their market (43%).
However, our study also shows that the majority of the sector is looking confidently to the future, with over half (53%) of transportation and distribution SMEs feeling optimistic about the long-term economic prospects of the industry.
With SMEs in this sector having to navigate an array of challenges, it is critical that the government continues to provide support. Ensuring that plans for investment in road and train links throughout the Northern Powerhouse come to fruition is vital for the efficient movement of people and goods.
The government also needs to ensure SMEs can continue to import and export goods in Europe, as this capability is often the business backbone of transport and distribution SME firms.
At Hampshire Trust Bank, it’s our job as a specialist challenger bank to champion SMEs across the country and ensure they’re not left behind when competing against larger and online competitors from across the globe.
The banking industry and government need to work together to ensure these companies can access the right finance to make the most of future opportunities.
Jon Maycock is managing director of asset finance at Hampshire Trust Bank