Car makers give new boost to growing manufacturing sector

THE growth in the UK's manufacturing sector is continuing to gather pace, with new orders rising for the fifth month in a row and car making reaching its highest production levels since the start of the recession.

A CBI survey of 400 UK manufacturers found that in the three months to September output rose by 19 per cent, its fastest rate since August 2011.

The research revealed that 28 per cent of firms reported higher than normal order books in September, against 19 per cent saying they were lower than usual. The resultant 9 per cent positive balance is the highest since August 2007, reports The Independent.

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CBI's economics director Stephen Gifford said: "This month's results show the manufacturing recovery continuing to gather pace. Order books are the fullest they've been since the start of the financial crisis, and firms are ramping up production to meet demand."

Growth in Britain's car making industry helped boost the manufacturing figures. Research by the Society of Motor Manufacturers and Traders found that in August this year the UK produced 91,282 vehicles, up 16.2 per cent from the same month in 2012. The figure brings the total built in the past 12 months to 985,000, up 3.1 per cent on the previous year.

According to The Times, the output figures to the end of August, which is traditionally a quiet month for motor manufacturers, have already nearly matched those for the entirety of 2009.

Earlier this month, Jaguar Land Rover announced more good news for the UK's car industry. The luxury car manufacturer said it will be investing £1.5bn in expanding its product range, creating 1,700 new jobs at its plant in Solihull. David Cameron said Jaguar's expansion was a "huge vote of confidence" in the UK motoring industry.

John Leech, head of automotive at KPMG in Britain, said "soaring UK car production is being fuelled by rising demand from both the UK and the eurozone".

This week the Bank of England upgraded its estimate for Britain's third-quarter growth from 0.5 per cent to 0.7 per cent, matching the economy's second-quarter expansion.

Howard Archer, chief UK and European economist at IHS Global Insight, said the better than expected figures showed that the manufacturing sector has had "a very decent third quarter and contributed to likely stronger GDP growth".