UK subcontractors report positive outlook and look ahead to post-COVID boom
The UK’s subcontract manufacturing sector appears to have weathered the COVID storm and is emerging from lockdown with exceptionally strong sales pipelines, according to a cross-section of the industry’s leaders.
The positive outlook is leading many to accelerated investment plans and conversely, leading to increasing concerns about the robustness of supply chains and skills availability.
Chris Shield, director of Shield Group, a provider of machining and assembly solutions to the power generation, off-highway, construction and automotive industries, with facilities across the Midlands and North of England says the business outlook is very positive.
“The pipeline is very strong and we’re feeling a lot more positive compared to six months ago now that the situation with regards to COVID and Brexit is clearer. It makes us more confident about investing further.”
Chris Shield says Brexit uncertainty was a drag on the business, but since the turn of the year the outlook is much more positive: “Up until the 1st of January the uncertainty was a real negative, however European customers are now viewing the UK as a good source and we are seeing many more enquiries and interest. Our only concerns are finding people with the right skills and the capacity of the foundry supply chain to get us the raw materials.”
His sentiments, echoed by Andrew Whitham of Brooks Ltd, a Manchester-based subcontract manufacturer of gears, sprockets, shafts and adapted transmission chains, are typical of the positive mood that is surrounding UK manufacturing.
“We’ve enjoyed a period of sustained growth and investment despite the challenges of COVID and lockdowns. Our key industry sectors are growing and our investment strategy has just about been able to keep up with the increased demand. The sales pipeline is very strong and our only concern is finding the right skills for our business and the robustness of the supply chain.”
Andrew Whitham believes that the decision to continue with investment in new technology has been pivotal to the company’s success: “We’ve spent more in the last 12 months than at any other point in the company’s history, well over £1,000,000. We firmly believe one of the factors behind our increased turnover has been our willingness to invest in new machinery and technology.”
John Hyde of John Hyde Engineering, a Stoke-on-Trent-based subcontract machining and production engineering services provider to some of the world’s biggest names in plant, machinery, earth moving, and engine building, is also increasingly optimistic: “We’re more positive than six months ago and the pipeline is looking increasingly strong. We’re benefiting from some reshoring of operations back to the UK, but finding CNC machinists with the necessary skills and sourcing raw materials are a challenge.”
Alan Mucklow, managing director UK and Ireland sales and service at Yamazaki Mazak, says the optimism of the subcontracting sector is a much-needed boost for UK manufacturing: “The subcontracting sector, one of the backbones of UK manufacturing, has largely weathered the COVID storm. It is very striking when I talk to customers how positive the outlook is, particularly the strength of the new business pipeline.
“I’ve been particularly impressed by the continued willingness to invest in new technology which has put many subcontractors in a very strong position to take advantage of any upturn. With the announcement of the capital allowance super deduction announced in the Budget, which effectively offers a 25p reduction in Corporation Tax for every pound invested in machines, I would expect this commitment to investment to accelerate further. Coupled with the increased certainty with regard to our trading relationship with Europe and with COVID in retreat, the future looks very positive.”
Mazak announces record year for machine sales in 2018
Yamazaki Mazak celebrated a record year for machine sales in 2018, due to strong performance across a number of key market sectors
Yamazaki Mazak celebrated a record year for machine sales in 2018, due to strong performance across a number of key market sectors.
Despite uncertainty in the marketplace in the lead-up to Brexit, the machine tool manufacturer witnessed impressive sales, particularly throughout the automotive, oil and gas, and medical markets.
Alan Mucklow, managing director UK & Ireland Sales Division for Yamazaki Mazak, comments: “Mazak is delighted to announce that 2018 proved to be the company’s best ever year for UK machine sales.
“The resurgence of the oil and gas market was much welcomed and we saw great success with the sales of machines from the larger section of our portfolio, such as our INTEGREX e-H range of multi-tasking machine tools as well as our highly versatile MEGATURN vertical turning centres.”
“A particularly pleasing aspect of our 2018 sales performance was the volume of commodity machines, including the UK-made entry-level QT COMPACT turning centre range and the high-performance QUICK TURN series.
“The company has invested heavily in improving our European Manufacturing Centre in Worcester in recent years and it is especially rewarding to see that investment translate into shorter lead times and strong sales for UK-built machines.
“2018 also proved to be another fantastic year for UK sales of machines from our laser processing portfolio, following the recent additions to our Direct Diode Laser range, as well as the newly-unveiled 8.0 kW and 10.0 kW additions to our highly popular OPTIPLEX FIBER series.”
He concludes: “2019 has already started off strongly, having generated an impressive volume of enquiries from our presence at Autosport Engineering in January. This year was the first time we exhibited across the weekend, rather than just the ‘trade’ days, and it paid real dividends being the only machine tool manufacturer with a visible presence.”