Thursday, February 27, 2020

News: Rotherham car components site closure on the cards


Hydro is closing its car components facility in Rotherham as part of a wider restructuring of its Extruded Solutions operations.

The site on the Barbot Hall Industrial Estate is part of Hydro Components UK Ltd which offers surface finishing and mechanical fabrication solutions for the automotive industry. It specialises in aluminium fabrication.

Previously known as Sapa, Hydro is part of Norsk Hydro ASA, which is headquartered in Norway and one of the largest aluminium groups worldwide.

Hydro supplies to all UK based automotive manufacturers (Jaguar/Landrover, Nissan, Toyota, Honda, Aston Martin etc) and also exports approximately 20% of its turnover into mainland Europe (Volvo, Fiat, BMW).

Bosses at the firm said last year that there was a negative demand in Europe and North America for its extrusions products driven by weak macroeconomic development. In response, the company announced that its Extruded Solutions subsidiary was "taking firm measures in weak markets."

These measures included restructuring in Europe and North America with the full closures of its sites in Pinto (Spain), Redditch (UK), Rotherham (UK), and American sites at Belton (South Carolina) and Kalamazoo (Michigan). Plus its warehouses in Wakefield (UK) and Lodz (Poland), and its Dusseldorf office (Germany). Divestment in Chisineu Cris (Romania) was also announced.

Business is set to be largely transferred to other sites and additional restructuring and cost reduction initiatives are under way. Hydro has a number of other sites in the UK, not least at Gloucester where plans are being progressed for an expansion in order to create a one stop shop automotive standard manufacturing facility with all key processes under one roof.


Underlying EBIT (earnings before taxes) for Extruded Solutions decreased in Q4 of 2019 compared to the same quarter last year, from NOK 202 million in Q4 2018 to NOK 85 million. Results in all business units were lower than the same quarter last year, mainly driven by lower volumes due to the declining market, partially offset by higher margins. Results were positively impacted by insurance compensation of NOK 187 million related to a cyber-attack in March 2019.

Hilde Merete Aasheim, president and CEO of Hydro, said: "We have taken firm measures in a weak market. Our improvement program as well as cash release ambition are ahead of plan. Our improvement efforts will continue with full force, in line with our agenda towards lifting profitability and driving sustainability."

The Rotherham site has been taken over a number of times. Back in 2010, Swedish aluminium manufacturer, Sapa, completed the acquisition of the automotive related integrated roof rail business from Thule. Sapa formed a 50/50 joint venture between Orkla and Hydro in 2013 before Norsk Hydro's acquisition of Orkla's 50% ownership in Sapa in 2017.

Hydro website

Images: Google Maps


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