A Consett factory that makes car parts for Jaguar Land Rover and Nissan has seen a 33% boost to profits.
Labone Castleside, which manufactures plastic injection mouldings, has also seen its turnover climb towards the £15 million mark.
For the year ending December 2016, the firm’s turnover was £14.94 million. Its gross profit had risen by 33%, with after-tax profits climbing by 36% to £916,000.
As well as creating 11 new jobs in 2016, Labone Castleside opened an extra manufacturing unit at their Consett factory this year.
The company’s chairman, Alfred Stiegler, said, “We saw continued strong demand across the full range of vehicle platforms and this has resulted in a financial performance for the year which met our expectations.”
“Continued focus on systems and process improvements together with appropriate investments in new technology have contributed to an improved gross margin and pre-tax profits.”
The British car manufacturing sector has had to deal with some uncertainty recently because of Brexit.
Although Nissan last year pledged to stay in the north east and expand production, the Japanese company has recently been expressing concerns that it may have to change its plans if Britain cannot get the right Brexit deal.
If Theresa May is re-elected and walks away from the EU without a deal – as she has threatened she might – British car manufacturers could face tariffs of around 10% on their exports to the EU.
Mr Stiegler said that the best way Labone Castleside could deal with this uncertainty was to invest in its business.
Mr Stiegler said, “The automotive market in which we operate is highly competitive and margins remain tight, with continual pressure to reduce prices.”
“Although the economic uncertainty surrounding Brexit makes it difficult to predict with any confidence the performance of the company in the medium term, we are continuing to invest to meet the requirements of an expanding customer base.”
Labone Castleside – which also has dealings with BMW, Ford and Lear – has been supplying the automotive and electronics industries for around 40 years.
(Featured image courtesy of Land Rover Our Planet, from Flickr Creative Commons)