October 1, 2019 @ 15:09 by Steven Hugill
A car parts maker says it remains well placed to build on its successes, despite challenging trading conditions forcing a dip in sales.
Nifco UK says a manufacturer’s decision to switch production to Slovakia, the diesel emissions scandal, a US and Chinese trade war and Brexit uncertainty all dragged on its performance.
According to figures released this week, sales stood at £71.1 million in the 12 months to December 31 2018, which was down from £75.9 million in the previous year.
However, the firm says it remains confident, calling the situation not “a cause for major concern but one for positive action.”
The business, based at Eaglescliffe, near Stockton, is known for making plastic parts used in engines, interiors and exteriors across a number of marques, including BMW Mini, Ford, General Motors, Honda, Jaguar Landrover, Nissan, Renault, Toyota and Vauxhall Opel.
It says the biggest single factor contributing to the year-end sales reduction was the impact of a main customer switching production of a new model from the UK to Slovakia in July 2018, which left a gap in sales for the second half of the year.
However, it also cited the diesel emissions scandal, trade issues between the US and China, and Brexit turbulence for the fall.
Recently-appointed managing director Jim Casey called the results “disappointing, but not surprising”, adding the company will invest in products and people to overcome the setback.
Pointing to the business’ award-winning apprenticeship programme and previous investments, such as a research and development centre to bolster manufacturing operations, he said the company remains on a strong footing.
“The company has reported a drop in sales for the first time in a number of years as a direct result of the external market conditions we are operating in,” he said.
“As I have said previously, challenges present opportunities for improvement and while this is a setback, for the team at Nifco, it is simply that, a setback.
“We are working hard to continue to build on the strong relationships we have with our customers, we will continue to invest in product development, and we will continue to invest in our people so that we are in the best position possible to tackle whatever challenges we face.
“This is not a cause for major concern, but one for positive action.”
Jim also played down the effect of Brexit indecision, saying it won’t prevent the company, which employs more than 600 staff across its two Durham Lane factories, from being successful.
“Nifco is part of a thriving, yet challenged, industry in the UK; we have a strong business here in the Tees Valley, with a great heritage behind us,” he added.
“While we have reported a reduction in turnover, the overall picture is still incredibly healthy.
“While we can no longer influence Brexit, we can focus on the future, ensure we are in the best possible operating position and concentrate on designing and manufacturing the vehicles of the future to weather these stormy conditions.”