Production of Handbags And Luggage Helps Drive £9.2 Billion Growth In UK Manufacturing

UK production grew 3% to £364 billion as at the end of 2014 – the equivalent of £9.2 billion – according to analysis of the latest official PRODCOM Report from the ONS by Santander Corporate & Commercial.

• Value of UK production was £364 billion as at the end of 2014, up 3% year-on-year – the equivalent of £9.2 billion
• The manufacture of luggage, handbags and saddlery was the fastest growing UK manufacturing sector, up 54% year-on-year and worth £205 million
• Food and drink manufacturing continues its rise as a major UK growth industry: the manufacture of dairy, meat and pastry products is worth £21 billion to the UK economy alone
• The manufacture of motor vehicles remains the UK’s largest manufacturing sector, worth £36 billion to the economy as at the end of 2014

The improving economy and confidence in consumer spending led to the manufacture of luggage, handbags and saddlery becoming the fastest-growing manufacturing sector in the UK, with production worth £205 million in 2014 compared to £133 million in 2013 – a year on year increase of 54% and a seven-year high for the sector.

Overall, the manufacture of motor vehicles remains the largest UK manufacturing sector in terms of production, with £36 billion produced in 2014. Other major sectors include the manufacture of air and spacecraft related machinery (£21 billion); the manufacture of pharmaceutical preparations (£10 billion); and the operations of dairies and cheese making (£8 billion).

According to the analysis, the production of food-related products accounted for £21 billion as at the end of 2014. Indeed, the operations of dairies and cheese making, processing and persevering of meat (£7 billion) and manufacture of bread, pastry, goods and cakes (£6 billion) were three of the 10 largest manufacturing sectors in the UK.

Charles Garfit, Head of Manufacturing, Santander Corporate & Commercial, said: “We believe that a significant part of the growth in UK production is down to a focus on luxury products, as evidenced by the growth in handbags and luggage as well as the success of a number of upmarket UK car marques.

“Santander is also increasingly working with and supporting manufacturers of high-end food and drink products, usually with a strongly ‘British’ branding as these sorts of products are becoming increasingly well received domestically and also around the world.”

Top ten fastest-growing manufacturing sectors in the UK, 2013-2014

Top 10 largest manufacturing sectors in the UK in terms of production

Games and toys is another fast-growing sector for the UK economy. While the sector grew 50% in 2014. We continue to significant activity in the market.

Charles Garfit, Head of Manufacturing, Santander Corporate & Commercial, continued: “Santander is deeply committed to supporting the UK manufacturing sector, helping firms to grow and expand both domestically and overseas. In 2015 we provided financial support to a large number of diverse UK manufacturing businesses, from toys and games makers and clothing businesses to food and drink firms and manufacturers of motorbikes and electronic goods.

“In terms of growth opportunities, we firmly believe that trading internationally remains vital to the success of the UK manufacturing industry. There are significant opportunities for UK manufacturers across a range of international markets and this is a core focus for us and our clients in 2016. ‘Made in Britain’ is increasingly becoming synonymous with high quality products and the world has become very receptive to UK manufactured goods – from cars and pharmaceuticals, to handbags and cheese.”

Santander Corporate & Commercial offers a comprehensive suite of solutions to help UK manufacturers and businesses to both invest for growth as well as export and find international trading partners and suppliers. This includes the award-winning Santander Trade Portal – a unique online tool for businesses that can identify where the best importing and exporting opportunities are for their particular products and services.

The information contained in our press releases is intended solely for journalists and should not be used by consumers to make financial decisions.

Notes to editors

Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. It has brought real competition to the UK, through its 1|2|3 products for retail customers and relationship banking model for UK SMEs. As at 31 December 2015, Santander UK was one of the most switched to banks. The bank serves more than 14 million active customers with c. 20,000 employees and operates through 857 branches and 70 regional Corporate Business Centres. Santander UK is subject to the full supervision of the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in the UK. Santander UK plc customers are protected by the Financial Services Compensation Scheme (FSCS) in the UK.

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Banco Santander (SAN.MC, STD.N, BNC.LN) is a leading retail and commercial bank, based in Spain, with a meaningful market share in 10 core countries in Europe and the Americas. Santander is the largest bank in the euro zone by market capitalization and among the top banks on a global basis. Founded in 1857, Santander had EUR 1.51 trillion in managed funds, 13,000 branches and 194,000 employees at the close of 2015. In 2015, Santander made attributable profit of EUR 5,966 million, a 3% increase with respect to the previous year.

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