UK Manufacturing growing? News "round-up"

UK Manufacturing shows signs of a recovery

According to the month’s first economic indicator of the health of the sector, the UK manufacturing economy gathered pace in June, leading to a slight increase in employment for only the second time in the past 15 months. Although companies faced mounting cost pressures, this was partly offset by an improvement in their pricing power.
Roy Ayliffe, director of professional practice at CIPS, said: “The recovery of UK manufacturing was unremitting this month amidst reports from purchasing managers in the sector of robust growth in production and new business. Employment increased too for only the second time in nearly a year and a half as a result of rising workloads. Manufacturers continued to battle to protect firms' margins against soaring input price inflation, however, as the cost of metals, chemicals and energy rose significantly. This followed a report last week that rising commodity prices have now overtaken fraud as the top concern of financiers globally."
The CPI’s respected Purchasing Managers Index published today suggests that manufacturing operating conditions improved at the fastest rate for almost two years in June as it posted a reading of 55.1 - its highest since July 2004.
New orders rose at the sharpest pace in almost two years with demand from both domestic and export clients improving. Companies reported benefits from stronger economic conditions in the Eurozone, which led to growth of new orders from Germany, France, Italy and Spain. The seasonally adjusted New Orders Index posted a reading of 57.7, a level indicative of rapid growth of new business.
June data pointed to the sharpest rate of increase in average purchase prices for almost one-and-a-half years. Higher costs were linked to rising metals prices, especially for aluminium and steel. The costs of chemicals, energy, paper, plastics and timber were also higher than in May.
Similar reports last month showed increased manufacturing in Germany.
Source The Manufacturer

Toyota Expansion in Eastern Europe, but UK factories safe for now

TOYOTA’S western European factories, including both its UK plants, are safe from closure in the immediate future, the carmaker’s new European president has pledged. He said the company would continue production in these countries for “the long term”. But Tadashi Arashima gave warning that the growth in the European markets is coming from Central and Eastern Europe — where the Japanese company is building new factories. Speaking on a visit to a Toyota engine plant in Poland, Mr Arashima told The Times: “We don’t have any intention to close West European factories and move to East or Central Europe at the moment.

CBI chief's manufacturing pledge

The new boss of the CBI has told The Birmingham Post that he will carry on the fight for manufacturing.
Richard Lambert, who has taken over as director-general of the country's biggest business and industrial organisation from Sir Digby Jones, said he understands the problems that British manufacturers are facing from global competition and from soaring energy and raw material costs.
In an interview with the Post, he higlighted the importance of putting manufacturing's case to the Government.
He singled out how vital the car industry is to the British economy and the need to keep output at about the 1.5 million units a year that the industry is currently achieving.
Mr Lambert said it was important, for example, to ensure that Micra production remains at Nissan's Washington, Tyne & Wear, plant instead of being transferred to Spain "where the government is pulling rabbits out of the hat" to try to win the business.

Source ICBirmingham

Comment

The UK has suffered a number of blows to its car Industry in recent times. The MG Rover closure, followed by announcements of closures at Peugeot, Rhyton have naturally cast a cloud over the future of domestic car manufacturing. Richard Lambert was right to emphasise the importance of the car industry to the manufacturing industry as a whole and to the British economy.

Despite the optimistic figures presented by the CIPS I am not generally picking up any “feelgood” factor from steel users who continue to be worried about rising raw material and energy costs combined with low cost manufactured goods from Eastern Europe and Asia.

It is vitally important to the future of the UK that Government recognises the importance Manufacturing plays in the countries overall future economic health. We have the skill base, the innovators and the engineering excellence, We need the politicians to recognise these strengths and give the support that is needed to compete on equal terms with other Western economies.