UK car manufacturing rose by 1.2 per cent in January, while commercial vehicle output tumbled 20.5 per cent, new data revealed Thursday.

A total of 129,049 cars were produced during the month, compared to 127,500 a year ago, according to the Society of Motor Manufacturers and Traders(SMMT).

The car sector was supported by a strong domestic demand, which saw output rise 26.1% and exports increase by 79.1%.

Analysts suggest UK car manufacturing could grow a third bigger by 2016 with output approaching 2.0m vehicles each year, SMMT added.

"Despite ongoing economic challenges, growing demand for UK-built products in emerging global markets coupled with major new investment is paving the way for a positive year for automotive manufacturing," said SMMT Interim Chief Executive, Mike Baunton.

However, commercial vehicle production fell to 7,822 from 9,844 as exports fell 3.2% and output for the domestic market grew 3.2%.

Commercial vehicles include light panel vans, heavy trucks, minibuses, double-deckers and luxury coaches.

"UK registrations of trucks were strong through most of 2012, but dropped off in the final quarter impacting output," Baunton said.

"However, domestic demand for buses and coaches grew significantly through 2012 on the back of government incentives and a wider focus on public transport."

UK engine production declined 5.1% in January to 219,757 units.

RD

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