Director puts faith in quality of company and goes to rescue

Jun 6 2008 by Chris Knox, The Journal

THE new owner of a car part manufacturer is determined to turn the business around after buying it out of administration and saving 160 jobs.

County Durham’s Tolwood Technologies went into administration last month after a drastic decline in orders from two major customers took £2m from its £8m turnover last year.

The firm, at Newton Aycliffe, looked to be in serious trouble before its commercial director Peter Coates stumped up the cash to buy the business through his new company PC Automotive Ltd.

It is the second time the company, previously part of Vickers Pressings, has gone into administration in recent years. It ran into similar trouble in 2005, leading to the loss of 14 jobs.

Tolwood is now looking to put its problems behind it after winning the business of two new customers which it believes will help increase sales to more than £11m in five years’ time and create about 40 jobs.

Mr Coates, who secured a loan from business financiers State Securities to help with the deal, said: “I was brought into the company last year to help improve profits, but it was too late by then. The orders we were losing had been vital to the business and meant that we had our supply chain cut by 90% for a number of months.

“We had two new customers about to come online just before we went into administration and I wasn’t prepared to let the business go to the dogs. With the potential we have here, I knew I wasn’t throwing my money away on something that wasn’t going to perform.”

The manufacturer of nuts and bolts for cars has planning permission to expand its 9,500 sq m factory by 3,000sq m to house new robotic equipment, for which it has set aside £150,000.

The firm is now looking to benefit from Nissan’s decision to make a new model car at its Sunderland factory from 2010.

Mr Coates said: “We already supply a number of key parts to Nissan and would welcome the opportunity to help the firm cement its future in the North East. Despite our previous problems, we still produce quality products and remain attractive to big companies.”

With the potential we have here, I knew I wasn’t throwing my money away …