Summarise manufacturing in the Midlands they said. Pull the other one. You would need to write 10 books, let alone five pages, to do the story justice. So don’t waste words with this claptrap and get on with it man, as they might say in Staffs.
Midlands Makers – News in brief David Fox, chairman of Power Panels Electrical Systems in Walsall, is on a mission to reform the way skills are delivered to people training in manufacturing firms. In November he said competitiveness is being damaged because companies are failing to invest in building fundamental workshop skills, and is calling for companies to develop in-house training and not rely on government support. PP Electrical Systems is an Employer Champion for SEMTA. Yamazaki Mazak will showcase its new INTEGREX j series multi-tasking machine at Autosport Engineering 2011, January 13-14. The INTEGREX j can reduce a two-machine process down to one machine and reduces programming time. Mazak’s European headquarters in Worcester employs about 600 people and has the capacity to make 160 machine tools a month. Bissell Homecare, a manufacturer of vacuum cleaners and other household cleaning products, on December 2nd signed a three-year contract with East Midlands-based 3PL provider RCS Logistics for full warehousing services for Bissell’s UK operations. |
Birmingham , Derby, Coventry, Leicester, Stoke-on-Trent, Wolverhampton. Place names that resonate with industrial heritage and power. Many consider the birthplace of the Industrial Revolution is the Arkwright Mill in Cromford, Derbyshire, which is now a World Heritage site. It was here that engineering pioneer Sir Richard Arkwright built the world’s first successful water-powered cotton spinning mill, a big step towards large scale factory technology.
Telford in Shropshire can also claim to be the spiritual birthplace of British manufacturing, where the nearby Ironbridge Gorge Museum is a superb preservation of the Midlands’ contribution to British industry, housing bygone mills, engines, furnaces, and workshops.
Combining the West Midlands and East Midlands, this is by far the biggest region for manufacturing output in the UK, generating some £27.5bn of gross value add a year (East Midlands is £13.6bn and West Midlands £14.9bn). Manufacturing employment here tops 500,000 and the biggest sectors by output are automotive, including the vast components engineering industry of the Birmingham conurbation, food and drink, construction equipment, aerospace, and transport including rail.
Several sectors and companies are world class manufacturing exemplars. Staffordshire and Leicestershire, for example, make more construction equipment than any European country, the nucleus of a sector worth over £8.5bn in the UK with over 80% of production exported to more than 200 countries. JCB’s global headquarters and backhoe factory in Rocester and Caterpillar Leicester, which employs about 1,400 people, are the prime movers here.
The Midlands is the UK’s epicentre for certain types of food and drink manufacturing, especially for food such as processed meat. The Leicester to Melton Mowbray corridor forms the nucleus for a vast meat products, chilled and frozen food industry, including companies like the £650m Samworth Brothers group which helped Melton Mowbray to achieve protected status for its eponymous pies.
Walkers, Iceland Foods, Golden Wonder, Claybroke Mill and a host of family-owned SMEs dominate this sub-region’s employment. Ginsters located a factory in Leicester partly for its central UK location but also to take advantage of local food manufacturing skills.
The Food and Drink Federation says that food and drink makes up 19% of manufacturing output in the East Midlands (West Midlands 11%) and 17.75% of manufacturing employment, the highest in England and Wales.
JLR lives on in Birmingham
Jaguar Land Rover in Solihull, Castle Bromwich and Gaydon, and Toyota in Burnaston dominate the Midlands automotive sector. Modec, founded by Lord Jamie Borwick, is an upwardly mobile maker of zero emission commercial vehicles in Coventry. It is finding success with a US joint venture with Navistar and with some of the big retailers and courier firms like FedEx and Tesco. Manganese Bronze, makers of the Hackney cab, is also based in Coventry, while commercial vehicle maker LDV, formerly Leyland DAF Vans, went into administration in October 2009. Toyota faced a public relations crisis in 2010 with product recalls of the accelerator pedal on some models. However Burnaston will be best known to many in the UK car sector as being particularly adept at implementing short-time working and pay freezes on a largely compliant workforce, when the recession bit.
Thousands of jobs were saved at Jaguar Land Rover’s West Midlands plants in October. JLR said in September 2009 that one of its factories, either Castle Bromwich or Solihull, would close within 10 years. But the Unite union reached a new pay deal with management to secure the jobs of about 7,000 Midlands workers – 5,000 at Solihull, 2,000 at Castle Bromwich.
Managing director of Jaguar Cars UK Geoff Cousins said the news was a “shot in the arm for the whole region”, the BBC reported. “Our plans stretch out five and 10 years,” he said. “We just have to prove ourselves as we move through that period and be successful. JLR and Toyota between them support hundreds of engineering and fabricating businesses in the region (see boxout, Metal Assemblies).
Key people – The Midlands Stuart Fell is chairman and owner of Metal Assemblies in West Bromwich and chairs the EEF West Midlands Regional Council. As an automotive supplier his company had a very tough recession, where he attributes a four-day week, in part, to saving the business. He has been interviewed in several national newspapers. On government policy he told The Guardian in April: “They really, really, really have to do everything they can to encourage people to invest. Without investment we are not going to get out of it at all. We need a tax regime or capital allowances regime that allows me to see that when I make an investment I can get a return quickly.” Andrew Churchill, managing director, JJ Churchill Engineering Sue Kirby, head of external affairs, EEF Simon Griffiths is the chief executive of the Manufacturing Advisory Service. |
Midlands aerospace roars
Rolls-Royce is the biggest private sector employer in Derby with 11,000 employees, and one of the biggest in the region. The engineering group needs little introduction, nor emphasis of its importance to the Midlands aerospace supply chain, providing long term contracts to many local engineering firms such as Caparo Accles & Pollock (see page 146) and JJ Churchill Engineering (Interview, page 22). The BBC reported in October that Rolls- Royce Derby contributes £3.1bn directly to the local economy with a further £1.5bn generated indirectly from the aerospace firm’s factories and offices.
The company has had a difficult autumn, troubled by a faulty Trent 900 engine on a Qantas A380 aircraft that became a headline aviation incident.
Rolls-Royce’s investigations concluded that the fault was specific to the Trent 900, and that the failure was confined to a specific component in the turbine area of the engine. This caused an oil fire, which led to the release of the intermediate pressure turbine disc.
Rolls-Royce stated that safety remains its number one priority.
Despite a big order book of $54bn, Rolls-Royce said it has started consulting unions about 140 proposed job losses at its jet engine assembly and test facility. But local newspaper Derbyshire Evening Telegraph reported that joint chief negotiator for the Unite union at the Derby plant said he believed that between 500 and 600 positions could go in Derby, although no timeframe was given. In spite of difficulties imposed by the Trent 900 furore, the global engine maker continues to secure huge orders for its world class products, including one in November worth $1.8bn to power 20 aircraft for Air China.
Derby is a bastion of manufacturing, with Rolls-Royce, Bombardier at Litchurch Lane (3,000 employees) and Toyota Burnaston (about 3,500) dominating the private sector. Centre for Cities, a think tank, in October said the city was over reliant on large employers.
Derby is placed among the bottom 20 UK cities for firms with new VAT registrations between 1994 and 2007 and the report recommends that the city focuses on its strengths like advanced manufacturing and encouraged it to be more outward looking. But it remains a very highly skilled city (see paragraph starting Manufacturing partnership…).
The Midlands Aerospace Alliance was formed in 2003 to support and represent the aerospace industry across the Midlands region, with help from the regional development agencies Advantage West Midlands and the East Midlands Development Agency.
Under Dr Andrew Mair’s stewardship, the body has built up a membership of over 300 companies in the Midlands, with 14 outside the region, most of which are manufacturers or servicers to manufacturers. It collaborates with academia – including Loughborough, Coventry and Leicester universities – and trade groups to facilitate knowledge transfer, and has 15 meetings and events scheduled until the end of February.
Manufacturing partnership: Derby & Rolls-Royce ● Derby is the HQ for the Civil Aerospace business of Rolls-Royce. ● The company is the largest private sector employer in Derby, employing over 11,000 people directly and has been manufacturing continuously in the city for over 100 years. ● Over the last 10 years Rolls-Royce has developed an entirely new large civil engine product range, the Trent series, which has been both designed and produced in Derby. ● The Sinfin site (Derby) includes the main module and engine assembly lines, engine test beds as well as manufacturing facilities producing a range of components including turbine blades and rotative components (shafts and drums). ● It is also home to the Gas Turbine Services business, with a modern engine repair and overhaul facility on site. Derby is also home to the company’s nuclear submarine activities, based at Raynesway. Rolls-Royce has more than 50 years experience in nuclear engineering and has the largest nuclear skills base of any UK business. ●Derby has the highest export value per head of population in the UK. ● The proportion of skilled employees in Derby is 2.4 times the national average. |
Bioscience hub
Nottingham has long been a hotspot for bioscience and medical research and development. BioCity in Nottingham provides business support, finance, labs and offices to bioscience, pharmaceutical, medicine technology and healthcare companies. Launched in 2003, the 129,000 sq ft awardwinning site hosts nearly 70 companies and has over 525 employees. Several companies are making and selling pharmacy products commercially. “12 of 70 companies are manufacturing and about 2/3 are R&D based companies, the rest are patent agents and ancillary service providers,” says Miranda Knaggs, marketing manager at BioCity. The facility is self-funding now, having had funding from the local RDA and EU. “It now has its own investment fund, Mobius Lifesciences, which can invest up to £100,000 in viable projects,” says Knaggs.
BCM (formerly known as Boots Contract Manufacturing) has been present in Nottingham since 1933, but divested as a standalone company within Allliance Boots in 2009. It makes 5,000 product lines and variants, from healthcare to dental care and baby products, and employs 1,200 people with more factories in France, Germany and Poland. One of the biggest recent improvements at BCM was its new IT system that provides total visibility of its customer stock levels and forecasts.
“It allows us to respond to customers’ fluctuations in demand and takes away any chance of unexpected demand shift coming in to us,” says general manager Phil Lund. “This means we can flat-line our production and improve our efficiency and that we can manage our customers stock volumes for them so that they can concentrate on their core business” (see TM November for a profile on BCM).
One to Watch – Metal Assemblies Metal Assemblies in West Bromwich specialises in the production of presswork and assemblies for the automotive industry. Over the last 10 years, the company has trebled in size and invested heavily in all parts of the business. In August 2010 the company took delivery of the latest model 400-tonne Aida roll feed press which complements the company’s existing production facilities. In recent years numerous robotic assembly and welding cells have been put into production and Metal Assemblies has developed its own automated optical inspection process. The company has also worked closely with the Warwick Manufacturing Group at Warwick University to strengthen various parts of the business. Current production includes components for the BMW Mini and various Nissan, Honda and Jaguar Land Rover vehicles, among others. “In today’s fast changing automotive industry, it is becoming more and more important to compete by being cleverer than the low cost economies. Metal Assemblies believes it is winning on that count,” says chairman Stuart Fell, who is regional head of EEF in the West Midlands. |
One to watch – Delcam looks East Donald Welborn, a director of Cambridge University, started a company to develop CAD and CAM software in 1965. Today, Delcam plc is a market leading supplier of machining software with 230 UK employees and 550 globally, and forecast turnover for FY2010 of £35m. Last month, Delcam’s chief executive Clive Martell (pictured right) was chosen as an industry delegate on Prime Minister David Cameron’s first official visit to China. The delegation included senior UK Government representatives and industry delegates from leading UK manufacturers including Rolls-Royce, GKN and Doosan Power. Martell was a member of the Advanced Manufacturing panel at the Business Summit organised by the China-Britain Business Council and UKTI. He also concluded a long term agreement covering software support and maintenance with First Auto Works, Delcam’s biggest Chinese customer. “I was extremely honoured to be chosen to take part in this important visit,” Martell said. “It provided a huge boost to Delcam’s profile in China, especially among larger companies and government officials.” Sales of software and supporting services in China have increased by more than 50% in the first three quarters of 2010, compared with the first nine months of 2009, and China is now the firm’s biggest market for new sales. |
Train and rail industry gets £8bn boost
The Midlands is home to the UK’s biggest rail and transport manufacturing base. Bombardier in Derby, with about 3,000 employees, is a front line candidate to build some or all of the new Thameslink carriages, part of the Transport Ministry’s £8bn budget to improve the rail infrastructure that was announced in November. Hundreds of other SMEs making parts for rail infrastructure will benefit from the investment, many of them in the Midlands.
Representing some of these firms is The Rail Alliance, which claims to be the fastest growing rail networking organisation in the UK. Like the Midlands Aerospace Alliance, EEF and the MAN group, it is a sound example of Midlands’ business collaboration. Spanning all aspects of the railway sector and its supporting industries, The Rail Alliance taps into both existing and aspirational business opportunities, providing companies with opportunities to network, collaborate and innovate with suppliers and customers, to help maintain and grow the prosperity and sustainability of businesses. Headed by Colin Flack, The Rail Alliance is supported by the Manufacturing Advisory Service West Midlands, UKTI and the European Regional Development Fund.
Recession in the Midlands – First response
While it is futile to try to summarise one feature common to all manufacturing in the Midlands, one important point is the positive way in which companies here responded to the recession. “Midlands businesses reacted rapidly and efficiently to the economic downturn by putting in place measures to reduce redundancies,” says Sue Kirby, head of external affairs for EEF Midlands.
Companies across all sectors in the Midlands were swift to recognise the need to retain skilled workers so they could hit the ground running when the recovery came, Kirby says. At the same time the recession triggered an appetite within businesses to become even leaner; reducing inventories, reevaluating processes and implementing cost saving measures, for example, energy saving. “Nevertheless the region, especially the West Midlands, was hit particularly hard with significant job losses. While many businesses have reported they are starting to re-recruit some of those they laid off, there is still a long way to go before they recover to pre-recession levels,” says Kirby.
How did the Midlands fare in the recession? Official HMCS figures of insolvency and bankruptcy petitions filed in the High Court and county courts of England and Wales, show that in the last period of true negative economic growth, Q4 2009, the Midlands region as a whole had 323 company winding up petitions filed, which was 7% fewer than in Q4 2008, the first recessionary quarter.
This is quite robust compared with the South East, which had a much higher rise in insolvency petitions in 2009. It is interesting to note that, in this 12-month period, government figures show there were more manufacturing job vacancies (in job centres) in the Midlands than other areas of the country.
Collaboration in action – The spirit of collaboration has helped a unique manufacturing group in the West Midlands shrug off the effects of recession and post encouraging results in 2010. MAN is made up of 10 independent companies that have joined forces to share capabilities, pool skills and pursue new contracts both at home and abroad It is an approach that MAN believes is unique, and one that is already reaping dividends with the combined force picking up £10m of orders in the automotive, medical and white goods sectors. Its success lies in ‘capability compatibility’, where each member offers a complementary engineering discipline. Founding members Alucast, Barkley Plastics, Brandauer, FW Cables and Westley Engineering have now been joined by Advanced Chemical Etching, Excalibur Engineering, Note UK, PP Electrical Systems and Wrekin Circuits. Together the group, which employs more than 600 people and has combined sales of £60m, can offer existing and potential customers technical excellence in every aspect of mechanical, electrical and electronic engineering. “MAN was originally set-up to secure contracts that could be shared around the members and we’ve enjoyed significant success in doing this,” says David Spears (left), chairman of MAN and managing director of precision pressing and stamping company Brandauer. “When the recession struck in 2009 it served a different purpose. Every company saw sales drop, some by 50 per cent. Being part of a group meant I could pick up the phone to a fellow MD and we could share issues and tackle problems together. The end result saw members work together to reduce costs and increase efficiencies and this gave us a decent platform when the upturn arrived.” And arrive it has. In the last 12 months, every MAN company has reported increased sales and some are now in the process of recruiting more people to cope with demand. A new identity is also being used to spearhead a big sales push in potential new markets including, medical, micro machining, rail and renewable energies. For more information please visit: www.man-group.co.uk |