Britain's economy shrinks in April with the closure of auto factories

Economy and stock exchange

Britain's economy shrank sharply in April after the biggest decline in car production since the data began, while manufacturers were unable to turn back on planned closure plans in anticipation of Britain's withdrawal from the European Union.

At the beginning of 2019, several car manufacturers announced temporary closure plans in April in Britain in anticipation of trade disruptions at the time of Britain's withdrawal from the European Union [EU] on March 29.

But Prime Minister Teresa May delayed the withdrawal a few days ahead of schedule and later set a new date on Oct. 31, but it was too late to change plans.

According to the Office of National Statistics, the economy contracted 0.4 percent in April after falling 0.1 percent in March, a drop more than any of the economists surveyed in a Reuters poll last week.

Growth in the three months to April slowed to 0.3 percent from 0.5 percent in the first quarter of 2019, a much larger decline than most economists expected, and the annual growth rate slowed to 1.3 percent.

But this has a greater impact on the manufacturing sector, which contracted 3.9 percent in April, its biggest drop since June 2002.

Car production fell 24 percent during the month, the largest since data was recorded in 1995, and the broader "transport equipment" sector recorded the biggest drop since 1974