(Reuters) -- The UK's car manufacturing sector reported lower output in January as automakers invest in production of new models and technologies.
Production fell 1.2 percent to 127,385 vehicles last month compared with 128,915 units a year ago, the Society of Motor Manufacturers and Traders (SMMT) said in a statement.
"The slight dip in output in January is as a result of this investment as major UK car manufacturers begin production of new models. As production ramps up throughout the year, we expect to see the sector's output increase," Mike Hawes, CEO of the SMMT, said on Wednesday.
Hawes' comments were echoed by John Leech, KPMG’s UK Head of Automotive, who said the results "represent a blip as [UK] car plants prepare to launch new models such as the Jaguar XE, Land Rover Discovery Sport and variants of the BMW Mini and Honda CR-V."
“The UK’s car manufacturers are experiencing headwinds of weak European demand and a strong pound but our luxury cars remain highly desirable in Asia and the Americas. This together with buoyant home demand and a high number of important vehicle launches in the UK in 2014 and 2015 will drive up UK car production in 2015. We expect an overall rise of 8 percent in 2015,” Leech said.
Car exports for January fell 6.2 percent to 97,022 units, compared with 103,534 units a year ago, the group said.
The UK exported under 1.2 million units to more than 100 countries in 2014, the highest share of UK exports in history, according to the SMMT. Also, the number of UK-built cars exported to Asia has trebled in five years. China is the largest single market for British-built cars after the UK, according to the SMMT.
The automotive body remains positive on the outlook for 2015 as UK-based manufacturers plan 7 billion pounds (9.4 billion euros) worth of investment in new products.
Nissan, Toyota, Honda, BMW's Mini and Rolls-Royce marques, Volkswagen's Bentley, as well as Tata's Jaguar Land Rover are among companies that build cars in the UK.