Sunday, 28 December 2014

Parts maker with an eye to the future

DPE-Automotive Ltd of Newton Aycliffe, County Durham, UK, expects turnover to increase by 30 per cent next year.

Peter Coates, managing director, claims the new business potential comes on the back of deals with new and existing customers.

The company supplies parts including wiring systems and pedal boxes, and works with clients such as Nissan, Gestamp, Magna and Johnson Controls.

In May 2014, the executives of DPE-Automotive Ltd undertook a management buyout, which saw them take ownership from United Steels Limited. They did this with backing from investors Andrew Lapping, Rudi Wright, and Rivers Capital Partners Limited. The company employs 100.

In a bold move, the company is investing £1.5 million in new presses and has earmarked £500,000 to raise its roof to accommodate larger presses, with Coates also re-negotiating contracts with banks Abn-Amro and Barclays.

The company also hopes to add another ten workers in the New Year.

According to Coates there is under-capacity in this sector, and he will not be the first to attach their business prospects on the likes of JaguarLandRover (JLR) and Nissan which have formed the backbone of the UK automotive alongside OEMs such as Honda Manufacturing and Toyota Motor Manufacturing.

The DPE-Automotive Ltd website claims the following are customer references: Aston Martin, Audi, Bentley, Renault, Volkswagen and Volvo; as well as Tier 1 parts suppliers like Faurecia, Johnson Controls, Lear Corporation, Thyssen Krupp, Tower Automotive and Visteon. It claims it can take a project from simple advance prototype design through to full-scale production.  

Coates claims both JLR and Nissan are looking for more UK-based suppliers and we have reacted to capitalise on that.”

Coates, who heads DPE’s sister company, Durham Precision Engineering Ltd, said he was also targeting customers in the oil and gas sector.

He is reported as saying: “We now have a strong financial footing in the automotive sector, and having had talks with two of the UK’s leading manufacturers since the buyout, we can see there are great things ahead.”

Durham Precision Engineering Ltd was formed in 1985 by Tom Stoddart and the company is described as a “long term strategic partner”. DPE-Automotive acquired Sonas Automotive Ltd of Tyseley, Birmingham in 2008 from administrators - a company that has seen sales rise from £2.5 million to £18.5 million in two years. Sonas supplies Ford Motor Company, JLR and Nissan.

Abn-Amro Commercial Finance clearly sees the company as having a viable future; it describes the business as “operating in a dynamic sector with some key company relationships”, with Coates as the “driving force behind its continued development.”

“Through his expertise and experience the business has been able to maintain and grow these relationships,” the company added.

Barclays too shares this view: it added: “The team have ambitious plans and there is strong demand in the automotive sector. This investment presents it with a great opportunity to increase capacity with existing clients and target new markets.”

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