UK car production heads for first annual fall since financial crisis – business live

The number of cars made in UK factories fell 2% in the first 11 months of the year, putting the industry on course for its first annual fall in production since 2009, when Britain was in the depths of the financial crisis

There were 245,000 new US jobless claims in the latest week, more than the previous week and more than the 231,000 predicted by economists.

[Insights] #USD – Initial Jobless Claims – 1st negative surprise for the last 4 weeks#InitialJoblessClaims

The US economy grew by an annual rate of 3.2% in the third quarter, slightly slower than the 3.3% estimated previously.

Despite the downgrade, it was the quickest pace of growth since the first quarter of 2015 and an improvement on the 3.1% growth in the second quarter.

The FTSE 100 is up 35 points and outperforming its major European peers this afternoon, as investors remain fairly subdued.

The latest scores:

Billionaire property developers the Candy brothers have won a bruising high court battle after a judge dismissed all claims brought against them by a former friend for extortion, blackmail, intimidation and breach of the data protection act.

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John McDonnell, the shadow chancellor, has given his take on this morning’s public finances figures, which showed borrowing fell in November.

These figures are further bad news just before Christmas following on from the IMF’s gloomy outlook issued yesterday. They only remind us yet again of the broken Tory promises to eliminate the deficit by 2015. The national debt continues to grow despite the tricks the Chancellor attempted in his Budget last month with Housing Association debt to hide his failure on the economy. This continued failure by the Tory Government over these past seven years is simply unacceptable.

These figures today reaffirm why we need an urgent change of course next year, halting the growing emergency in our public services and ending the failed Tory austerity cuts.

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John Hawksworth, chief economist at the accountancy firm PwC, takes a look at some of the detail in the November public finances data:

Public borrowing in November was broadly unchanged from last year, but for the financial year to date the budget deficit is running around £3 billion less than in the same period last year. This reflects central government receipts growing at around 4%, while central government spending has only been rising at around 3%. VAT, income tax, national insurance and stamp duty revenues have all been growing at a reasonable rate so far this year.

As the OBR has indicated, however, self-assessment receipts in early 2018 may be less strong than in early 2017, so today’s figures still leave public borrowing on track to come in at around £50 billion in 2017/18 as a whole.

The Treasury has responded to the latest public finances figures, seizing on the fact that borrowing in the fiscal year so far is the lowest since 2007.

A spokesperson said:

This is the best year-to-date borrowing in a decade, but there is still further to go to repair the public finances.

We continue to build an economy fit for the future by taking a balanced approach, getting debt falling while investing in our vital public services and keeping taxes low.

The jewel in Britain’s manufacturing crown is at risk because of Brexit uncertainty and falling wages according to Britain’s largest union, Unite.

The latest figures from the Society of Motor Manufacturers and Traders show the number of cars made in British factories destined for the UK market plunged 28% in November to 24,276. It was the fourth month in a row that cars built for the home market fell.

This is awful news in the run-up to Christmas for the British car industry and the UK economy. The continued falling demand in the UK market because of Brexit uncertainty and falling wages is yet more evidence of the government’s economic incompetence.

When other economies around the world are motoring ahead, the UK is stuck in the slow lane hobbled by the biggest squeeze in wages since the Napoleonic era. Meanwhile uncertainty around Brexit is leaving motor manufacturers stalling on the investment needed to maintain Britain’s world leading status in car making.

The UK government borrowed £8.7bn last month, which was £200m less than the same month last year and the lowest November net borrowing since 2007, on the eve of the financial crisis.

It was lower than the £8.9bn predicted by economists. The figure for October was also revised down, to £7.8bn from £8bn, topping off some decent news for the chancellor, Philip Hammond.

While a continuation of the current trend would see borrowing undershoot the OBR’s forecast by £7bn, some deterioration in the public finances should occur towards the end of the fiscal year. In particular, strong self-assessment tax receipts collected in January and February 2017 – due to changes in the dividend tax rate – won’t be repeated.

As a result, we doubt that borrowing will come in significantly below the OBR’s current £49.9 forecast for the 2017/18 fiscal year. However, if we are right in thinking that the OBR is too gloomy about the prospects for GDP growth, then borrowing should come down at a faster rate than it expects further ahead.

Alex Buttle, director at the car comparison website,, is downbeat about prospects for Britain’s car industry:

This is a stunning fall in domestic demand and pretty much sums up the last six months for an industry reeling from punitive diesel taxes and crumbling consumer confidence.

The fact that manufacturing levels fell just 4.6% last month, when domestic demand dropped off a cliff, shows just how reliant we are on exports. And that’s probably more worrying than faltering demand, as right now we have no EU trade agreement and zero clarity over trading agreements with countries outside the EU.

The number of cars made in UK factories in the first 11 months of the year was 2% lower than over the same period in 2016, at 1.58m vehicles.

If the weak trend persists in December, UK car production will have suffered its first annual fall since 2009, when Britain was in the depths of the financial crisis. In that year, production plunged 31% to 999,460 cars.

Exports drive UK car manufacturing in November as domestic demand falters #UKmfg #UKAutomotive

Britain’s listed house builders are among the FTSE 100’s biggest fallers this morning:

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European investors are in no mood to celebrate this morning, with the major markets following Wall Street lower.

It turns out the markets are not as ecstatic about the successful passage of Donald Trump’s as the President himself.

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UK consumer confidence fell again in December according to the latest monthly snapshot from GfK.

The index fell by one point to -13, marking almost two years of declining consumer confidence.

We need to see several issues move on before the downward trend of the consumer mood changes. We need to have a better sense of how Brexit will pan out, and also of how quickly and how far interest rates will rise. But none of this will be resolved quickly so there’s every likelihood that 2018 will take us lower.

Garry White, chief investment commentator at Charles Stanley, has found something to be cheerful about in the UK car market:

Despite gloomy news on UK car production, shares in UK-focused car dealership Lookers have still joined the Santa rally and are up 11% since early December low. But down 10% over the year.

UK car manufacturing is on course to fall in 2017 overall.

In the first 11 months of the year, a total of 1.58m cars rolled off UK production lines, down 2% compared with the same point in 2016.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Brexit uncertainty, coupled with confusion over diesel taxation and air quality plans, continues to impact domestic demand for new cars and, with it, production output. Whilst it is good to see exports grow in November, this only reinforces how overseas demand remains the driving force for UK car manufacturing.

Clarity on the nature of our future overseas trading relationships, including details on transition arrangements with the EU, is vital for future growth and success.

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