UK car industry in brace position ahead of Brexit deadline

Carmakers face perfect storm of EU exit uncertainty and weaker demand in China

With British manufacturing contracting sharply in the second quarter, industrial firms large and small are under pressure. Nowhere is that more the case than in the car industry, which is contending with a backlash against diesel and weaker demand in China that has coincided with Brexit uncertainty stifling investment.

The "perfect storm" for carmakers has quickly been passed down the supply chain, according to David Caro, the owner of Qualplast, a Birmingham-based maker of flock coatings for car parts such as glove compartments and coin trays in vehicles made by Jaguar Land Rover, Nissan and Bentley. The company, which employs 17 people, has seen a fall in orders from some of its major customers as they adjust to lower sales.

One of the two main definitions of recession in the UK is at least two quarters of negative economic growth. Judged by this yardstick, the UK was last in recession in 2008-09, when there were six consecutive quarters of negative growth.