With annual revenues upwards of $729bn, the global aerospace industry is one of the world’s most valuable sectors. It is also one of the most intensive investors in research and development. That investment is not likely to slow down any time soon.
According to Deloitte, the industry’s strong growth trajectory is estimated to continue in 2019, led by increases in commercial aircraft production and defence spending. In the commercial sector, the backlog for aircraft orders is at a record high. Experts predict that 38,000 aircraft will be produced over the next two decades. In defence, rising geopolitical tensions are driving growth in government spending across the world, from the US to China. Turbulence caused by tragic crashes or Brexit uncertainty won’t shift these fundamentals.
This buoyancy is brilliant news for Bradford company Produmax, the Baildon-based manufacturing company with an expertise in high-precision engineering. The business is a global expert in flight control components and a supplier to world-leading aerospace companies such as Boeing, Bombardier, Moog and Meggitt. Produmax is on a strong growth trajectory of its own: turnover has increased from £4.2m in 2014 to £8.9m in 2018 and is on course for £10m by 2020. Exports make up 70 per cent of sales, with customers in the USA, Canada, Japan, Philippines and Morocco.
Produmax is plotting its path for future growth. The company invested £4.5m in its high-tech facility at Baildon. This opened in 2016. Later this spring, Produmax will expand into a new unit with the latest machining technology, representing a further investment of £2.3m. This facility will serve a major aerospace prime manufacturer. “We see the aerospace market as very buoyant,” said managing director Jeremy Ridyard, who praised the “proactive, business-focused” Bradford Council for supporting the company’s move.
As well as spending on plant and machinery, Produmax is investing in its people and is proud of its one-team philosophy, which aims to empower its 76 staff and recognise that each individual is an important part of the overall success of the business. Looking after your staff makes good business sense. The company achieved a massive increase in productivity after adopting an innovation identified by one of its 20 young apprentices. This reduced a lead time from 32 days to 27 hours. That shows the value of listening to your people.
“We have always believed that to stay ahead of the competition we need to invest, not only in the latest technology but in our approach to business and the development of our people and culture,” said Mr Ridyard. “It’s essential if you are going to compete in a global market place that you can improve your efficiencies year on year.”
Produmax is taking part in the Sharing in Growth scheme, a £250m government-backed initiative to improve the global competitiveness of the UK aerospace supply chain. Last September, it won a national award recognising its progress since joining the scheme in 2014.
The UK is a world leader in the aerospace industry. The sector has recorded productivity growth of 65 per cent since 2010 – the reward for investment in research and development – and employs 92 per cent of its workers outside London and the South East. Workers are typically well-paid as well, earning nearly £41,000 a year, which is 43 per cent more than the national average. Overall, the UK generated nearly $49bn of revenue in 2017, a fair share of the global $729bn.
Of course, the UK can earn more and it’s inspiring to see companies like Produmax setting ambitious targets, investing in high-tech manufacturing facilities, improving productivity and taking on apprentices and developing them through meaningful training schemes.
At the Bradford Economic Partnership, we are determined to ensure that our young and enterprising people are equipped with the skills and confidence to succeed. We are also determined to build on our business and sector strengths to drive innovation, increase productivity and create wealth. In both these respects, Produmax is a perfect case study.
• Dave Baldwin is chairman of the Bradford Economic Partnership and chief executive of Burnley Football Club