Crumbling sales, slashed output and lost jobs... the world's automotive industry is facing its worst recession since Henry Ford built his Model T. But not all carmakers are feeling bruised. Four British firms—all leaders in their own spheres—aim to keep accelerating in this downturn. With booming order books, greener cars and design expertise, they're pulling ahead of the pack
Group Lotus Sports car manufacturer
Mike Kimberley, chief executive of Group Lotus, is
in bed with a bug, but couldn't be more chipper about the company's prospects for 2009. In May, Lotus plans to launch its Evora 2+2 mid-engined sports car. "It's a natural progression from the two-seater sports cars we currently make," he says. Sports car sales, like others, have been hit by the recession, but Kimberley believes that Lotus is weathering the turmoil better than competitors. "We have the advantage of providing customers with high-performance cars which are economical to own and run, and don't have a stratospherically high price," he says.
Besides that, Lotus is now selling its cars in 41 countries and recently added Saudi Arabia to the buyers' list. This means tough conditions in Britain and the US are offset by sales where people still have money to spend. When Kimberley became chief executive in 2006, he created a strategic five-year plan, which, as events have panned out, will help Group Lotus through the slump. The strategy includes introducing three new cars and making the engineering "even more high-tech and global than we were".
Sirus Automotive Mobility vehicle maker
While most motor manufacturers are looking to cut staff and move to smaller premises, Sirus Automotive is expanding, creating 35 new jobs. The Wednesbury-based company, which specialises in adapting cars for disabled drivers, has just moved to a factory four times the size of its previous one, with the aid of £249,000 from development agency Advantage West Midlands.
This year Sirus, which has a £5m turnover, expects to deliver up to 300 vehicles, just five years after it was started by Simon Pearson and Russell Venvil, who had a passion for engineering and £60,000 capital borrowed from parents. The secret of their success has been to step outside the mainstream and develop a niche that other automotive suppliers haven't properly exploited. "Our idea was to design a vehicle based on a compact car, such as a Renault, that would be much more useable in everyday situations by disabled people," explains Pearson.
"We picked a niche product so that we were able to control our pricing and not be constrained by what other people were charging for a similar product."
Even so, the partners were down to the last £1,000 of their capital before they banked the cheque from the first sale. Since then, it's been ever upwards, with four moves to larger premises in as many years.
This year, Sirus expects to start selling into Europe, having gained necessary EU approvals. Enquiries are already coming in from Germany and France, and Pearson says there's huge potential on the continent as few other companies are supplying comparable vehicles.
The business has also signed a deal with a US firm called Autovan to manufacture its designs under licence. Pearson estimates the annual market in the US at 25,000 vehicles a year compared with 6,000 in the UK. "If we could only get royalties from a small percentage of the US market, revenues could be huge," Pearson says.
One key to the firm's success is that it has brought stylish design into vehicles for the disabled. "What we've tried to do is make them more appealing," says Pearson. "We wanted to
take away that medical-product feeling and give it a bit of bling. We fit out the interiors in fibreglass, which was difficult to set up but gives the cars a real fresh-from-factory feel. We just love what we do. And the cherry on the top is that we're making a product that changes people's lives."
Westfield Sportscars Customised car specialist
Julian Turner, managing director of Westfield Sportscars, is a carmaker that doesn't mind if his customers build the vehicles themselves. In fact, he encourages it. The firm provides its Westfield XI as a road-ready car or as a kit that petrol-heads can construct in their own garage.
Last year, Westfield, which has a £3.5m turnover, sold 280 of its models. This year, Turner reckons that will rise to 350, and he's not too worried about the recession because the firm is building sales overseas. It has gained EU approval for its vehicles, so it can now sell in 27 countries. Additionally, it has dealerships in the US, Australia, Asia and the Middle East. "Last year, about 60 per cent of our sales were overseas. This year, our overseas sales are likely to reach about 80 per cent," Turner explains.
One key to Westfield's success is recognising that when an enthusiast buys a customised sports car, he or she wants to be able to change it.
"There must be a thousand ways our cars can be customised," says Turner. But he also believes that much of the company's competitive edge comes from its design and technology expertise. Among its 30 employees there are designers with automotive and aerospace experience. "We're able to capture design synergies from other industries," says Turner.
A big investment in 3D computer-aided design techniques has been crucial in keeping Westfield right at the front when it comes to developing new ideas. Turner says it's important for a small carmaker to be more nimble than the bigger competitors.
"Major manufacturers may take a year or two to get a new project into service," he says. "We can get a concept through to manufacture in a number of weeks."
But although Turner remains confident Westfield will continue to drive ahead despite the recession, he's launched a number of initiatives designed to ensure that the company works even more effectively.
One of these is a scheme that pays out a bonus to any employee who comes up with an idea that saves more than £400 a year. "At any one time, we'll be looking at between 150 and 200 ideas," he says. He cites one example: "We buy engines, take parts off them and add new components. By getting the supplier to send the engine without the unwanted bits, we've cut costs to ourselves and saved time."
Turner has started another project that is exploring how to save money with supply chain partners. "We started it at the end of last year with five suppliers, but we already have about 50 ideas."
He attended a London meeting to hear about the motor industry's rescue package launched by business secretary Lord Mandelson. "As far as I'm concerned the package doesn't help us," he says. And with sales booming and the road ahead clear, Westfield doesn't need it anyway.
Modec Maker of zero-emission vehicles
Lord (Jamie) Borwick, chairman of Modec, wants to give the world's truckmakers an electric shock. Last year, his company sold just 100 of its all-electric delivery trucks. This year, he's on track to quadruple those sales. And after that, who knows?
Modec, which makes its vehicles in Coventry, the traditional heart of Britain's automotive industry, is about to announce a joint venture with a leading American truck manufacturer. Borwick expects this deal will accelerate sales into thousands a year.
The British market for base-to-customer delivery vehicles—such as those used by FedEx for parcels or Tesco for home delivery—is around 40,000 a year. In Europe, where Modec has already won sales in Spain, Germany, Switzerland and the Netherlands, it's around 300,000. There are dozens of manufacturers chasing these sales, but Borwick claims: "Nobody else has a purpose-built electric truck." There is pressure on fleet operators to become greener, so Borwick could be backing a winner.
Modec's low-noise trucks, which typically carry two tonnes in the payload and have a 100-mile range at 50mph, use no carbon-burning fuel at all. They run off a one-tonne rechargeable battery. "If you top that up using zero-emission electricity, you've got a system where the only source of carbon dioxide is the driver," says Borwick, "and you're not going to be able to get rid of him."
He acknowledges that he picked the difficult option when he set out to design and build an all-electric truck,
after founding Modec in 2004. But the gamble has paid off. "We're now leading the world in this technology because nobody is producing a pure electric truck like this. It's a lot easier to start with an existing vehicle and change it. The trouble is the compromises you have to make are, in my opinion, fatal to the vehicle in the end."
Borwick gathered a team of enthusiastic younger engineers to work on the project. "In the big automotive companies, you might be in charge of the right rear-wheel nut and eventually get promoted to be in charge of the entire wheel. But members of our small team can get involved in the whole vehicle. It attracts people with a broader outlook and a more creative approach."
On the production line at the Coventry plant, there are more laptops than welding machines. "When you go around our factory, you don't see noisy stuff," explains Borwick. "We buy-in assemblies and then bolt them together. We make our money out of being clever-not by doing the basic stuff."
Modec has around 200 mostly British suppliers that handle the ordinary stuff. The company should notch up £20m turnover this year. Borwick sees it growing beyond that despite the recession. "The thing is, we're very different. Nobody is really solving the problems of a practical, electric commercial vehicle apart from us."
