Sales at Worcestershire-based engineering group GKN rose by 13% yesterday, driven by increased orders from Chinese buyers in the luxury car market.
For the 12 months to December, sales within the firm’s automotive division GKN Driveline, which makes engine and chassis components for UK original equipment manufacturers (OEMs) such as Jaguar Land Rover, grew by 10% from £2.4bn in 2010 to £2.7bn in 2011.
Around 75% of GKN Powder Metallurgy sales are also to the automotive market, which experienced a 13% increase in sales, from £759m in 2010 to £845m in 2011.
Although the fall in European sales were offset by growth in Asia and North America, GKN stated that the growing performance in these regions would be lower in 2012 than in 2011.
GKN’s aerospace division was boosted by record deliveries and order backlogs at core customers Airbus and Boeing, the growth in the number of commercial airliners offsetting shrinking orders from the US military.
Growing revenue resulted in a 2% growth of profits at GKN, a figure that was hit by adverse currency trading conditions and the £15m negative impact from the Japanese earthquake and tsunami.
GKN has been preparing for growth in the electric vehicles market, investing £4m in EVO Electric, a UK firm that designs and manufacturers axial flux motors, and formed a joint venture, GKN EVO eDrive Systems, to manufacture and sell items for use in hybrid and all-electric vehicles.
GKN expects 2012 to provide further growth, but predicts that European sales will fall again. Its external forecasts suggest that the automotive division will continue to perform strongly, stating that vehicle production should grow by 5% in 2012 due to further increases in Asia and North America.
Nigel Stein, chief executive at GKN, commented: “2011 was a year of good growth. GKN achieved a strong financial performance with all four divisions at or near record profits and each division has a strong pipeline of new business.”
Mr Stein added: “GKN Driveline and GKN Land Systems were further strengthened with the two highly complementary acquisitions of Getrag Driveline Products and Stromag.”