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The government's planned cap on migrant numbers could hurt the UK's car manufacturers, the industry's trade body has warned.

The Society of Motor Manufacturers and Traders (SMMT) said the cap would hurt global companies, like carmakers, that operate in the UK.

Meanwhile the society reported a 37.3% rise in car production in August compared with the same time last year.

A total of 77,882 cars were made in the UK last month.

'Significant challenges'

The SMMT's chief executive Paul Everitt said the figures showed that UK vehicle and engine production was leading "a strong manufacturing recovery".

But speaking to the BBC he admitted that the rise in production this year was being compared with significantly reduced production in 2009.

Last year, many car makers were forced make big cut-backs as the worldwide demand for cars collapsed.

"There are still significant challenges ahead and the government must do all it can to encourage continued international investment in UK-based [research and development], skills, plant and machinery," Mr Everitt said.

Earlier he called for the planned government cap on immigrants into the UK to exclude transfers of staff within companies.

Car makers including Nissan, Toyota and General Motors operate plants in the UK, and the SMMT is concerned that the cap could prevent them moving staff to the UK from their plants in other countries.

"Highly skilled employees transferred to work within the UK automotive industry are essential to maintaining and improving our global productivity and competitiveness," Mr Everitt said.

"[The] industry is concerned that the inclusion of intra-company transfers could impact on the attractiveness of the UK as a location for inward investment and undermine the UK's role in an increasingly global economy."