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Manufacturing

Automotive suppliers in the North East report mixed results amid global challenges

Accounts for companies in the region show some grappled with lower sales and production volumes for major customers

Gestamp's base in Newton Aycliffe(Image: -Newcastle Journal)

Car parts makers across the North East have talked about a range of performances with some seeing improved revenue and profitability.

Fresh accounts for many of the region's tier 1 automotive suppliers have been published in recent weeks, covering a year in which the sector continued to face a number of challenges from regulatory constraints in the transition to electric motoring to cost inflation. Key suppliers representing hundreds of jobs in the North East reported gains despite a year in which overall º£½ÇÊÓÆµ car production plummeted by 11.8%.

In Washington, interior trim specialist Kasai º£½ÇÊÓÆµ saw turnover drop from £72m to £69.7m but operating profits grew from £663,000 to £1.74m and pre-tax profits were boosted from more than £759,000 to £1.82m. The Japanese-owned firm, which provides door trims, said sales of production parts for the Nissan Qashqai were down 2% to £1m whilst sales of parts for the Nissan Juke model were up 16% to £2.2m.

Sales of Nissan Leaf parts were down 84% to £5.3m, owing to the model reaching the end of its production cycle in early 2024. Overall, sales of Nissan products fell 6% to £4.1m year-on-year.

Kasai bosses said production sales for Jaguar Land Rover products increased by 21% to £700,000. And tooling sales increased from zero in 2023 to £1.3m in 2024 - relating to the Qashqai. Others sales - including spares and trial parts - were down £200,000 in the year. Staff numbers at the Wearside operation fell from 681 to 546, mainly driven by a reduction in production headcount.

About 30 miles south of Kasai, on the A1, Spanish-owned Gestamp Tallent Limited saw sales grow from £442.6m to £447.4m. Together with a reduction in administration costs, this helped the maker of metal components to convert an £8m operating loss into £6.9m operating profit.

Directors talked about the easing of major headwinds including semiconductor chip and raw materials shortages which had dogged the global sector - including its customers - in the wake of Covid. It said customers were now ramping production levels back up, and in some cases catching up with backlogs.

But despite the positive movements, Gestamp said 2025 sales are expected to be moderate due to the impact of interest rates and inflationary pressures harming household spending power, and in turn the firm's manufacturer clients. Headcount at the firm grew between 2023 and 2024, from 1,770 to 1,830.