Car production for the UK market has fallen for the sixth month in a row, new figures reveal.
A total of 28,229 cars were built for the UK in January, 6% down on the same month a year ago, reflecting falling business and consumer confidence.
The Society of Motor Manufacturers and traders (SMMT) also blamed confusion over Government policies on diesel taxation and air quality plans.
The fall in domestic demand was offset by growth in exports, with a record 119,252 British-built cars shipped overseas last month, up by 1.5%.
Mike Hawes, SMMT chief executive, said: “While it is good to see global appetite for British-built cars reach record levels in January, this only reinforces the industry’s increasing reliance on overseas demand.
“Future growth will therefore depend on maintaining our current open trade links not just with Europe but with key international markets.
“A transitional deal will be an important first step but, in the long term, a seamless relationship between the UK and Europe must be maintained.
“The EU remains the third largest new car market in the world and, given it is on our doorstep, it is not surprising it accounts for more than half of our global exports.”
A total of 147,481 cars were built in the UK in January, 72 fewer than a year ago.