UK economy slides in April after Brexit car plant shutdowns, Latest Business News - The New Paper

UK economy slides in April after Brexit car plant shutdowns

This article is more than 12 months old

LONDON : Britain's economy contracted in April after the biggest fall in car production since records began, as manufacturers were unable to reverse closures planned for when they had expected Britain to leave the European Union.

Early this year, motor manufacturers announced temporary shutdowns in Britain for April, in anticipation of trade disruption around the time Britain was due to leave the EU on March 29.

In the event, then prime minister Theresa May delayed departure with just days to go and set a new date of Oct 31 - but this was too late for businesses to change their plans.

Britain's economy overall contracted by 0.4 per cent in April after a 0.1 per cent decline in March, the Office for National Statistics said yesterday, a bigger drop than any economist had forecast in a Reuters poll last week.

Growth in the three months to April slowed to 0.3 per cent from 0.5 per cent in the first quarter of 2019, also a sharper deceleration than most economists had expected. Annual growth rate fell to 1.3 per cent.

But this masked a far bigger impact for the manufacturing sector, which shrank by 3.9 per cent on the month in April, the biggest fall since June 2002.

Car production in April fell 24 per cent on the month, the biggest drop since records began in 1995, and the broader category of transport equipment showed its largest drop since 1974.- AFP