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You can find the current article at its original source at https://www.theguardian.com/business/live/2017/oct/26/brexit-fears-uk-car-industry-european-central-bank-qe-stimulus-draghi-business-live
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| Brexit fears grip UK car industry as production tumbles – business live | Brexit fears grip UK car industry as production tumbles – business live |
| (35 minutes later) | |
| 8.49am BST | |
| 08:49 | |
| Today’s drop in UK car production is the fourth blow to the auto industry in recent weeks. | |
| We’ve also seen that: | |
| Car sales have fallen for six months running, including a 9% drop in September | |
| Vauxhall is cutting 400 jobs at its Ellesmere Port plant, after seeing falling demand for the Astra | |
| Pendragon, the leading car dealership group, issued a profits warning after suffering a sharp fall in demand and falling prices. | |
| 8.31am BST | |
| 08:31 | |
| Inchcape, the new and used car dealer, has also warned that Britain’s car sector is deteriorating. | |
| In its latest financial results, released this morning, it says: | |
| UK market slowing, as expected, resulting in continuing margin pressure on vehicles. | |
| In other words, we’re buying fewer cars, forcing dealers to cut prices to get a sale. | |
| 8.15am BST | 8.15am BST |
| 08:15 | 08:15 |
| UK car production falls as Brexit fears mount | UK car production falls as Brexit fears mount |
| The storm clouds gathering over Britain’s car industry have darkened this morning, after manufacturers suffered a sharp fall in production. | The storm clouds gathering over Britain’s car industry have darkened this morning, after manufacturers suffered a sharp fall in production. |
| Output shrank by 4.1% in September, new figures from the motor industry show. | Output shrank by 4.1% in September, new figures from the motor industry show. |
| Alarmingly, domestic demand tumbled by 14.2%, while there was also a 1.1% decline in production for exports. | Alarmingly, domestic demand tumbled by 14.2%, while there was also a 1.1% decline in production for exports. |
| In total, 6,500 fewer cars were produced last month than in September 2016. That has helped to drag production during 2017 down by 2.2%: | In total, 6,500 fewer cars were produced last month than in September 2016. That has helped to drag production during 2017 down by 2.2%: |
| Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, says the industry is suffering from falling confidence - and a government clampdown on diesel cars. | Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, says the industry is suffering from falling confidence - and a government clampdown on diesel cars. |
| Hawes says the industry’s big fear is that Britain leaves the EU without a deal, which would disrupt the car industry’s ability to buy and sell cars and components across the channel. | Hawes says the industry’s big fear is that Britain leaves the EU without a deal, which would disrupt the car industry’s ability to buy and sell cars and components across the channel. |
| “With UK car manufacturing falling for a fifth month this year, it’s clear that declining consumer and business confidence is affecting domestic demand and hence production volumes. Uncertainty regarding the national air quality plans also didn’t help the domestic market for diesel cars, despite the fact that these new vehicles will face no extra charges or restrictions across theUK. | “With UK car manufacturing falling for a fifth month this year, it’s clear that declining consumer and business confidence is affecting domestic demand and hence production volumes. Uncertainty regarding the national air quality plans also didn’t help the domestic market for diesel cars, despite the fact that these new vehicles will face no extra charges or restrictions across theUK. |
| Brexit is the greatest challenge of our times and yet we still don’t have any clarity on what our future relationship with our biggest trading partner will look like, nor detail of the transitional deal being sought. Leaving the EU with no deal would be the worst outcome for our sector so we urge government to deliver on its commitments and safeguard the competitiveness of the industry.” | Brexit is the greatest challenge of our times and yet we still don’t have any clarity on what our future relationship with our biggest trading partner will look like, nor detail of the transitional deal being sought. Leaving the EU with no deal would be the worst outcome for our sector so we urge government to deliver on its commitments and safeguard the competitiveness of the industry.” |
| These disappointing figures come a day after Japanese manufacturer Toyota urged the government to raise the ‘fog’ of Brexit uncertainty. | These disappointing figures come a day after Japanese manufacturer Toyota urged the government to raise the ‘fog’ of Brexit uncertainty. |
| City analyst Simon French of Panmure Gordon points out that car production has gone into reverse in other countries too...... | City analyst Simon French of Panmure Gordon points out that car production has gone into reverse in other countries too...... |
| Worth noting this morning that fall in UK car production mirrors global inflection in trend. Far from clear from the data that fall is #Brexit-related pic.twitter.com/I7sYGLSkMm | Worth noting this morning that fall in UK car production mirrors global inflection in trend. Far from clear from the data that fall is #Brexit-related pic.twitter.com/I7sYGLSkMm |
| Updated | Updated |
| at 8.26am BST | at 8.26am BST |
| 7.57am BST | 7.57am BST |
| 07:57 | 07:57 |
| The agenda: IT'S ECB DAY! | The agenda: IT'S ECB DAY! |
| Good morning, and welcome to our rolling coverage of the world economy, the financial market, the eurozone and business. | Good morning, and welcome to our rolling coverage of the world economy, the financial market, the eurozone and business. |
| All eyes will be on the European Central Bank today, as the eurozone’s top central bankers meet to set monetary policy. And it could be a red letter day, with the ECB likely to turn down the gas on its money-printing programme. | All eyes will be on the European Central Bank today, as the eurozone’s top central bankers meet to set monetary policy. And it could be a red letter day, with the ECB likely to turn down the gas on its money-printing programme. |
| With Europe’s economy firing on all cylinders, the ECB is likely to decide to cut the pace of its bond-buying stimulus scheme, which is currently creating €60bn of new money each month. | With Europe’s economy firing on all cylinders, the ECB is likely to decide to cut the pace of its bond-buying stimulus scheme, which is currently creating €60bn of new money each month. |
| But, inflation is still below target, so the ECB won’t feel under pressure to slam the brakes. Instead, it will probably cut the pace of quantitative easing...but by how much? | But, inflation is still below target, so the ECB won’t feel under pressure to slam the brakes. Instead, it will probably cut the pace of quantitative easing...but by how much? |
| No-one’s really sure, so prepare for drama when ECB chief Mario Draghi reveals how he plans to slow, or ‘taper’, the stimulus plan. | No-one’s really sure, so prepare for drama when ECB chief Mario Draghi reveals how he plans to slow, or ‘taper’, the stimulus plan. |
| Good Taper Day morning from Frankfurt. #ECB | Good Taper Day morning from Frankfurt. #ECB |
| Financial group PNC predicts that the ECB will lop €15bn off its QE programme, and keep buying government and corporate bonds until next autumn. | Financial group PNC predicts that the ECB will lop €15bn off its QE programme, and keep buying government and corporate bonds until next autumn. |
| They say: | They say: |
| We expect a reduction in monthly asset purchases to perhaps €45 billion euros in January from the current €60 billion. The ECB will probably refrain from a firm commitment to an end-date for its program at tomorrow’s decision; we expect purchases to continue until at least the third quarter of 2018. | We expect a reduction in monthly asset purchases to perhaps €45 billion euros in January from the current €60 billion. The ECB will probably refrain from a firm commitment to an end-date for its program at tomorrow’s decision; we expect purchases to continue until at least the third quarter of 2018. |
| Draghi’s challenge is to avoid alarming the markets, sparking a crash in bond prices or a surge in the euro. | Draghi’s challenge is to avoid alarming the markets, sparking a crash in bond prices or a surge in the euro. |
| Capital Economics say he must strike a delicate balance: | Capital Economics say he must strike a delicate balance: |
| Following the numerous signals from President Draghi and colleagues over recent months, the market is well primed for some form of taper announcement. But there is still a delicate balance to strike. | Following the numerous signals from President Draghi and colleagues over recent months, the market is well primed for some form of taper announcement. But there is still a delicate balance to strike. |
| Taper too quickly and the markets might worry that the ECB’s historically hawkish instincts – typified by the premature (and subsequently reversed) interest rate hikes of 2011 – may be resurfacing. One obvious consequence could be an undesirable rise in the euro. But too tentative a move could fuel concerns that the ECB has little confidence in the economic outlook and the effectiveness of its previous policy measures. | Taper too quickly and the markets might worry that the ECB’s historically hawkish instincts – typified by the premature (and subsequently reversed) interest rate hikes of 2011 – may be resurfacing. One obvious consequence could be an undesirable rise in the euro. But too tentative a move could fuel concerns that the ECB has little confidence in the economic outlook and the effectiveness of its previous policy measures. |
| European stock markets are expected to rise a little, while traders wait for the ECB’s announcement at lunchtime. | European stock markets are expected to rise a little, while traders wait for the ECB’s announcement at lunchtime. |
| European Opening Calls:#FTSE 7462 +0.19%#DAX 12972 +0.14%#CAC 5382 +0.13%#MIB 22483 +0.16%#IBEX 10146 -0.07% | European Opening Calls:#FTSE 7462 +0.19%#DAX 12972 +0.14%#CAC 5382 +0.13%#MIB 22483 +0.16%#IBEX 10146 -0.07% |
| Also today.... Barclays Bank and high street retailer Debenhams are reporting results this morning. We also get a new survey of retail spending from the CBI. | Also today.... Barclays Bank and high street retailer Debenhams are reporting results this morning. We also get a new survey of retail spending from the CBI. |
| The agenda: | The agenda: |
| 11am BST: CBI’s survey of retail sales in October | 11am BST: CBI’s survey of retail sales in October |
| 12.45pm BST: ECB interest rate decision | 12.45pm BST: ECB interest rate decision |
| 1.30pm BST: ECB president Mario Draghi’s press conference | 1.30pm BST: ECB president Mario Draghi’s press conference |
| 1.30pm BST: US trade figures for September | 1.30pm BST: US trade figures for September |