End of an Era: Vauxhall Luton Plant Closure Marks Decline in UK Car Manufacturing
Vauxhall’s Luton car plant ceased production on March 28, 2025, ending 120 years of vehicle manufacturing and affecting approximately 1,100 workers. The site has since been sold to Goodman for development into a new industrial park.
This closure follows a pattern of decline seen with previous shutdowns such as Honda Swindon in 2021 and Ford Bridgend in 2020, reflecting continuing challenges in UK car manufacturing.
In the first half of 2025, the UK produced 417,000 cars and vans, with full-year output projected around 755,000 units, marking the lowest production since 1953 and falling below levels recorded during the Covid-19 pandemic period.
The UK automotive sector contributes about £22 billion to the economy and supported around 198,000 jobs in 2023. Job losses in this sector pose significant risks to regional economies and their wider economic impacts.
High manufacturing costs in the UK, driven by labor and energy expenses, combined with Brexit-related uncertainty and trade-policy issues, have hindered investment and competitiveness in the sector.
Despite these challenges, there are areas of investment and potential growth, particularly in electric vehicles and battery production, such as the Nissan Sunderland Leaf and Juke plants, the AESC battery facility, and Jaguar Land Rover/Tata operations in Somerset. Supplier diversification is also underway.
The government aims to produce 1.3 million vehicles by 2035, but current projections indicate a challenging path to industry resurgence in the UK.
