How Nifco became the poster boy for the rebirth of British manufacturing

LESS than 10 years after it was ready to call in the administrators a North-East plastics firm played host to the Chancellor of the Exchequer.

The Treasury PR team, who had been working overtime to prepare the ground for George Osborne’s pre Election visit to the North-East, could not believe their luck when they heard that Nifco had won a £50m deal to supply Ford. This type of thing is manna from heaven for politicians desperate to launch their regional growth manifesto alongside a local success story. Unlike many of the rehashed and pimped-up announcements made on the Chancellor’s whistestop tour around the region last Friday, the Nifco deal was news - big news. Following a week of leaden skies many of George Osborne’s entourage of security guards and spin doctors drove up to the Nifco reception area wearing sunglasses to dim the glaring early spring sunshine. The blue sky setting was almost too good to be true.

The Stockton firm had seen off the challenge from some of the biggest names in the industry, in the economic strongholds of Japan, Germany and China, to win a contract that had deeper significance beyond the 50 jobs it would create when production starts next year. Had Nifco bid for this type of deal 10 years ago its application form would have quickly found itself nestling at the bottom of a waste paper bin.

At that point the firm was a loss-making operation occupying a down-at-heel factory on Yarm Road, Stockton.

It is a sign of the firm’s confidence that its bosses were delighted, but not surprised, when Ford became the latest blue chip manufacturer to hand the Eaglescliffe firm a major deal. It now supplies components for almost every UK-made car on the road from two purpose-built plants crammed with brand new machinery.

There is a fair chance that the cup-holder or air vent in your car was made by Nifco. Every Qashqai which rolls out of Nissan's Sunderland plant contains about £50-worth of Nifco fixtures and fittings.

Since Mike Matthews took the helm in 2008, Nifco UK has enjoyed a remarkable transformation from the threat of closure, to a £60m turnover business employing more than 500 staff.

Liz Mayes Region Director for the North East of manufacturers’ organisation EEF, said: "Nifco is a great example of how manufacturing companies can seize opportunities both in the UK and across the globe to support jobs and growth in the North-East. Their success is backed by an excellent track record in ongoing skills investment and is a company the region should be proud of."

By the end of 2018 Nifco expects to have 800 staff and top £100m a year turnover.

The Tees Valley company produces about 25 million plastic parts a month, from door handles to cup holders, for car makers including Nissan, Honda and Jaguar Land Rover. More than £35m has been invested over the last three years.

Last year, it opened its second new factory in three years on Durham Lane, Eaglescliffe. It quickly outgrew the first plant when the orders started rolling in, Doug Binks, Nifco finance director tells me, as we kick our heels on the factory floor waiting for Mr Osborne, who is running an hour late. “Where we are standing right now was going to be the staff’s seven-a-side football pitch before we realised we were going to need a second factory,” says Mr Binks, from the shopfloor of the plant which includes Nifco’s 12-strong research and development team, who are helping to secure the firm’s long term future.

“The changes we have implemented have been fundamental, but had we just carried on doing the same thing, I suspect we would have gone under,” says Mr Binks. "There were simple things were getting wrong – like our Spanish plant was supplying customers in Leeds, while we were shipping stuff to Seville. Basic stuff that was costing us money.

"And one of the big things was us taking control of the business at a local level and reducing the involvement from Japan,” he adds.

The impact of Mr Matthews, named an MBE in 2014 for services to business in the North-East, has also been key.

“He is a bundle of energy,” notes Mr Binks, of the man who oversees all of Nifco’s European operations.

Mike Matthews grew up in the Branksome area of Darlington, took an apprenticeship at Phoenix Tubemans, which occupied the site of George Stephenson’s works, and later moved to Elite Engineering in Newton Aycliffe. He first joined Nifco, then known as Elta Plastics, in 1986 as a toolmaker. Following a brief hiatus his career at Nifco took off and by 2000 he was deputy managing director, and took the top job six years later.

The firm’s investment in skills has been a vital part of its success.

Shortly before Christmas 2011 the firm announced that trainee engineers Thomas Beagrie and Thomas Waldock, both of Eaglescliffe, and Joshua Appleyard, of Darlington,would become the first apprentices to join for a decade. Since then, apprenticeships have been a key part of its strategy.

The Ford deal – which will see Nifco make about a million thermostat holders a year that will be shipped all over the word - has put the prospect of a third plant being built back on the agenda.

Mr Matthews explains: “We will look at our existing resources, but if we continue at this rate then we are going to need additional space at some point in the not too distant future. It is a bit like moving into a new house. At first it seems far too big and then eventually you have outgrown it.

“We are so proud of the Ford contract. What has made it particularly pleasing is that when Alan Mulally took over as chief executive of Ford in 2006 he identified that they had far too many suppliers – 7,500 worldwide. He set a target of reducing that to 750. It is now down to 2,500, and we are one of them. We are already part of an exclusive club, and we aim to still be a member of the 750 club. I am confident that we will be.”

Mr Osborne isn’t the only part of the government to have been seduced by the Nifco story.

The Automotive Investment Organisation - part of UKTI - has asked it to take part in a promotional video. The AIO regards the Tees Valley firm as a poster boy for the renaissance of British manufacturing.

“People keep asking me – ‘when is Nifco going to plateau?’ That has never crossed my mind," says Mr Matthews. "McDonald's doesn’t plateau, it just keeps reinventing itself, adapting to the market, finding ways of doing things even better and more efficiently. That is what we will do. We will never stop. I am a believer – an absolute optimist. It phased some people but I always knew we would get there. The more we achieve the more we believe,” he concludes.