Manufacturing and engineering making progress
Aug 21 2009 By Andrew Hebden, The Journal
THE North East has long been known as an area that makes things. And that hasn’t always been regarded as good news when the economy turns ugly.
As Britain entered recession in 2008, there was a general consensus in the region that its much diversified economy compared to days of old stood it in good stead to survive the worst of what was thrown at it.
As the only part of the UK that actually exports more goods than it imports, there was also a sense that the international markets may also help to protect some of the engineering and manufacturing powerhouses that remain mainstays of the North East economy.
Now that we have – arguably – hit the bottom of the economic cycle and perhaps (say it quietly) even begun the slow journey towards recovery, there is no doubt that the North East’s manufactuing base has been hit hard.
Every company has its own story to tell – but generally it’s one of survival in the teeth of financial pressures the likes of which many have never seen before. As well as the downturn in markets which has hit sales, firms have also been face with funding difficulties brought on by the crisis in the banking sector.
The sector that has perhaps been afforded more airtime than any other than banking has been car manufacturing and it’s a story that is very familiar to everyone in the North East. Nissan – the powerhouse of the Wearside economy – went from enjoying a boom year in mid 2008 to a dramatic collapse in new car sales of some 40%.
Inevitably, the Japanese-owned giant was forced to shutdown production for a period during which time staff were moved from the production line on to training or other duties. The temporary measures were just that, however, and the inevitable followed in January when Nissan said it would be making 1,200 redundancies.
A campaign finally led to some support for the industry being agreed and the most effective response has been the introduction of the Government’s scrappage scheme and 14 months of declining sales of new vehicles finally came to an end in June.
In recent months, Nissan has been recruiting again and it will soon be looking for even more staff after the firm confirmed plans to build a new battery plant at its Sunderland factory. The move was seen as an indicator that the site was also likely to be chosen to build the firm’s new generation of electric cars.
The battery plant announcement coincided with an announcement by the Government that the North East had been chosen as the UK’s first low-carbon vehicle region. It followed the launch of The Journal’s Great North Revolution campaign which aims to spearhead a "new industrial revolution" for the North East built around future technologies such as low-carbon vehicles and offshore wind.
Such developments give cause for optimism at a challenging time – especially for Teesside. There, a series of plant closures at the powerhouse of the processing industry, the Wilton site near Redcar, coupled with the uncertainty surrounding Corus’s future on Teesside, means there are testing times ahead for these integral parts of the North East economy.
