The motor industry has a spring in its step at the news that car production increased by 27% in 2010, prompting claims it is ‘leading the manufacturing recovery.’

Figures released by the Society Of Motor Manufacturers And Traders show that car output rose by 27.1% to 1.27 million cars in 2010 - with growth up 10.6% in December alone.

While van and truck production accelerated to an impressive 35.7% over the year to 123,019.

Seen as a whole, overall vehicle production rose 27.8%. Paul Everitt, SMMT chief executive, said that the figures prove that UK vehicle production is ‘leading the manufacturing recovery’.

He added: ‘UK manufacturers exported more than a million vehicles last year, underlining the competitiveness and desirability of the current model line-up.’

The manufacturing sector accounts for 13% of UK GDP as a whole.

The boost to the manufacturing sector – which accounts for 13% of UK GDP - suggests that overall output is looking likely to achieve growth of 3.8% in 2010 - the strongest yearly increase since 1994.