100 years young

100 years young

Geoff Ford’s manufacturing business has scored a century of success despite the worst efforts of latter-day banks and government, he explains to Brian Nicholls.

True to character, Geoff Ford has celebrated his firm’s centenary in a warehouse, not some nobby hotel. “It’s nice to remind people throughout the evening that we’re first and foremost in the business of manufacturing,” he explained. The 165 guests still found the decor as striking as any hotel’s, down to the metal sculptures shaped by the firm’s own workforce. The food equally impressed.

Planning for the evening on Simonside East Industrial Estate, South Shields, had been immaculate – rather like Ford Group’s daily standards in producing parts for aircraft, automotive, rail and power needs. Ford Aerospace parts are made at Tyne Dock for Lynx and Puma helicopters and fixed-wing aircraft. Ford Component Manufacturing at Hebburn specialises in precision machining, pressing and laser profiling for the likes of Caterpillar, JCB, Komatsu, Bombardier Rail, Freudenberg and Anixter.

Brian Shaw, managing director of UK Trade and Investment, says the aerospace activity is a great example of how North East innovation and expertise helps the region maintain world-class standing. Its clients include BAE Systems, Honeywell, Rolls Royce, Goodrich, MOOG, APPH and Agusta Westland, from whom a recent three-year contract may prove worth £17m.

Both operations, uplifted by a recent £1m enhancement of technology, epitomise the indomitable spirit of North East engineering, unyielding to barmy-brained politics, myopic bankers, mishaps and daily challenges. In 100years Ford Group has come through two world wars, two blazes (1948 and 2003), global depression and numerous recessions.

“We’ve had to reinvent ourselves several times, every reinvention virtually a new start,” says Ford. Politically, Ford fires his frustrations over manufacturing’s struggles both right and left, blaming Margaret Thatcher for earlier attempts to kill it off, and Gordon Brown for over-favouring financial services. Now? “Chancellor Osborne’s Budget speech rightly talked of altering the balance of the economy, reducing dependence on the financial sector and lowering funding to the public sector,” he says.

“But so far he has rebalanced only that side of the scales.” Both Ford Group and the Engineering Employers’ Federation (for whom Geoff is a regional councillor), want dependence on the financial sector to give way to manufacturing led recovery, especially under pound favouring exporting. David Cameron commissioned a paper by the inventive entrepreneur Sir James Dyson before the election called Ingenious Britain and Ford believes its recommendations would work for manufacturing.

“I haven’t heard any government reference to it since,” he complains. “But regional development agencies are being closed by political dogma.” When he chaired a regional committee on aerospace every other region’s representative used to tell him: “I wish we had a One North East.” Now it’s going. Ford is reaping consequences. Its two companies applied separately for grants to fund growth and create jobs. “The Components bid was passed just before the General Election,” he says. “Now Ford Aerospace’s is caught in a morass and we don’t expect any of that money now.” Cutbacks in capital projects will ricochet into construction, civil engineering, equipment manufacturers and their supply chains.

The UK still stands eighth in the world by value of manufacturing output, but Ford feels banks are as oblivious to this as are governments. “Ours is still trying to get used to us, despite our 100 years with them,” he says.

“After the crisis they caused, banks’ idea of service seems to have changed. Everything now’s a deal, driven by returns. We used to feel confident they wished to back us as a viable business, but everything we ask for now is treated inisolation, not part of what we’d call the Ford Package.” Their demands for physical collateral is something Ford finds incongruous and disappointing. He’s the third generation chairman of the family company and the bank’s relationship director is regularly invited to board meetings. “We hide nothing,” he admits.

“Currently we’ve a very attractive opportunity that could double turnover in two years. However, that would require significant commitment and investment on our part and we’d like bank support. They seem to have lost the ability to see the broader picture.” But he lashes manufacturing and engineering too.

“We’ve a lot to do to repair a grubby image if we’re to attract people to a career with us,” he says. “Manufacturing offers myriad opportunities. You needn’t be an engineer to be in engineering – I’m an accountant.

There are openings in sales, purchasing, quality control, IT, HR – the list is endless.” Yet Ford heard a teacher tell a youngster: “If you don’t get your grades you’ll end up working in a factory.” As if that was the worst fate, Ford fumed, then he thought: “It’s our fault we’ve let people assume manufacturing and engineering are smelly, poorly paid and unattractive.” You could eat off the polished floors at Ford, so he reasons: “We must work with education-business partnerships to attract young people to work experience, or to visit.

Perhaps we should work first with their teachers.” Blue Venture, South Tyneside’s business and education link-up started and chaired by Ford, has a manufacturing manager and goes into schools. St Joseph’s, Hebburn, is a member. Mortimer Road too (his old school) is a primary school with an engineering club.

Jarrow School is the only one in Tyne and Wear giving special studies in engineering, promoting diplomas in engineering, manufacturing and product design.

But again, says Ford, the Government falls down... “The industry’s keen on diplomas in engineering and design,” he says.

“Their element of practical work with an employer appeals. The new Government has removed its support for their promotion.” To employers who claim they “can’t have kids on their shop floor” under Health and Safety regulations, Ford says: “Nonsense. You can extend your public liability cover for as little as a day.” Ford apprentices, besides support from South Tyneside College, are trained by older time-served employees encouraged out of retirement.

Some young people, asked what an engineer looks like, may reply “some bloke in an oily overall with a screwdriver in his top pocket“, yet in Germany, Ford observes, engineers are revered for their skill in making things. “Why the difference” he asks. “Some people, asked to name an engineer, quoted an actor playing a car mechanic in Coronation Street. That’s our problem.” And more than 50% of UK engineering graduates finish up in financial services, “picked off by the merchant banks and their pals for their intellect”, Ford complains. Yet precision engineers like Ford still innovate.

It’s one of only eight companies in the world producing laminate shimstock to seal joins between surfaces more efficiently. Instead of filing down a shim or juggling to find one fitting, Ford’s Easipeel comprises foils glued together, each two thousandths of an inch thick – peel off till you reach the required thickness. Easipeels are helping refurbish a steel mill in China.

Might Ford manufacture there? He says: “For every success story about low-cost offshoring there’s a horror story. We made some parts for JCB for years then lost to India. Now we’re about to remake for them. They couldn’t get the quality right abroad.” But China offers a big market for standard parts, and Ford is appointing agents. It exports also to North America and mainland Europe, and eyes Scandinavia. “There’s no source of laminate shimstock there,” he explains, “nor in India, Australia, Israel or South Africa.

Mining machinery in South Africa and Australia needs them, and there’s a healthy aerospace industry in South America to explore.” At home, Ford is looking to electric cars and wind turbines and given its work already for Bombardier it’s watching closely at attempts to bring assembly of Hitachi trains to Newton Aycliffe.

“Come recovery, which we don’t see till 2011, there’ll be significant opportunities, especially on the components side,” he says. “A number of competitors have gone out of business – we’re well placed to take advantage.” Only twice during a 75-minute interview does Ford sounds hesitant – when asked about job cuts, and about providing parts for British helicopters used in Iraq and Afghanistan. The workforce is down 40 to 152.

“We employ fewer than when I joined in 1974, largely through recession but also because advances in technology require fewer people with more skills,” he says. He regrets the job losses, also two painful pay cuts made, each for three months. He says: “I’ll be eternally grateful for our workforce’s sacrifices. But we’re leaner and fitter now. We’re well placed to be greater than before. I’m not sure I’m pleased about sacrifices our troops are being called to make. Iraq was a con and if the Russians gave up on Afghanistan what makes anyone think we’ll fare better?” However, without the helicopters, he agrees, British forces would be even more vulnerable. Today aerospace work provides £5m of the £8m currently coming in. When sales regain 2009 levels of £10m, probably next year, aerospace’s share could be £6m.