The Eaglescliffe-based company, which produces parts used for some of the world’s largest carmakers, saw sales drop to £71.1m for the 12 months ending 31 December 2018, down from £75.9million in 2017.
The biggest single factor contributing to the year-end reduction in sales has been the impact of a main customer moving 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.
Furthermore, the automotive industry experienced an overall downturn in sales as a result of the well documented ‘diesel scandal’ and the trade war between the US and China, in addition to the turbulence caused by continued Brexit uncertainty.
“It is disappointing, but not surprising, that 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,” said Jim Casey, managing director of Nifco UK.
“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.”
The company has recently made a number of improvements to ensure that its manufacturing operations are in optimal condition with minimal waste and increased efficiency. Back in 2014, it invested in a Research and Development centre as part of its second factory, which has continued to report successful project delivery and, as part of its people development programme, has an award-winning apprenticeship programme, committed to developing the workforce of the future.
Mr Casey was keen to add that prolonged indecision relating to any proposed Brexit deal is not ideal but it won’t prevent the company from continuing to be a success: “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. While we have reported a reduction in turnover, the overall picture is still incredibly healthy. And 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.”