Tooling and mould component manufacturers are reporting a rise in demand from UK companies, as work is reshored from countries in the Far East, such as China.
But however much work they can take on in the UK they say this is being hampered by the current skills shortage, which in turn is likely to be exacerbated in the future as toolmakers in their fifties take retirement without being replaced.
Another challenge for UK mould and tooling component makers is the implication of Brexit and the volatility in currency fluctuations.
Reiner Heendeniya, sales director at Gunther UK, says: “As the agent for the UK and Ireland for mould component manufacturer Knarr we are seeing an approximate increase of 10% year in sales in this part of our business.”
He attributes this partly, not completely, due to reshoring. “Labour costs in the Far East have risen over recent years and I feel the focus for UK manufacturing has swung back towards high quality and shorter lead times. These are not affected by goods manufactured in other parts of the world.”
Des Thorpe, managing director of HT Tooling paints a similar picture. He tells PRW sales enquiries are 20% up on last year due to reshoring.
Darren Parsons, Agentdraw's managing director, which provides tooling from both China and UK, also believes there has been a 10% increase in demand in tooling made in the UK. He attributes this partly to the 25% increase in costs of Chinese tool production and 5% increase in shipping costs.
Despite this, Parsons believes UK companies will continue to buy from tooling from the Far East because the UK market has failed to put in the investment required for skills and future infrastructure. “All good toolmakers are in their fifties and coming up to retirement. Filling that gap is not going to be completely possible, as tooling is a very skilled job which requires a minimum of five years training,” he says.
Agentdraw recently took on three apprentices to plug the gap in its own workforce.
Meanwhile, Terry O'Neill, managing director of Roemheld UK, tells PRW: “In general the UK market is still very quiet, with no substantial increase in hydraulic cylinder sales. But there have been new orders for die-changing equipment for retrofitting existing machinery to improve productivity and sales.” He attributes the former to end users' continued use of low-cost hydraulic elements from around the world due to the need to keep costs downs and the fact that new projects tend not to be long running.
Faulkner Moulds is optimistic about the continued reshoring of toolmaking and mould components to the UK. Caroline Faulkner, director of the Halifax-based firm, says: “We have recently seen an upsurge in enquiries, including from customers who have tried Far East toolmaking and are now realising the benefits of investing in UK toolmaking. We work hard to create a close working partnership with our customers and we can also provide very attractive leads time in the UK.”
She cites a client which required a cornerpiece tool for a display system for a customer to be designed and created in three weeks to meet their deadline. “We finished the tool two days ahead of schedule in September this year. The tool moulded successfully first time, achieving the customer's production target of 13,000 components on time, and our customer was delighted with the results.”
Manchester-based ADM Precision Tools, which supplies injection and blow moulding tooling technology to the automotive, medical and telecommunication technical industries, has seen an increase in export sales for its two-shot tooling technology. Jim Kelly, the firm's managing director, ascribes this to his firm's development of tooling for the manufacture of products that can protect electronics in harsh environments.
“But the downside is that domestic toolmaking sector is suffering due to the devalued currencies since the Brexit,” he says. “Imported material and services from European countries have increased as margins have increased, while confidence is low with job security being a future concern.”
Tooling and mould component makers believe the volatility in exchange rates will continue. Gunther UK's Heendeniya believes the fall in sterling should have a positive effect on exports but is quick to note that the problem lies in the fact that almost all machinery, mould components and polymers are imported which can negate the export advantages because of higher prices.
He says: “A crystal ball is needed to see the full impact of this in the short, medium and long term. In the medium to long term much will depend on the terms of our trade agreements with Europe. Whether we agreed with Brexit or not, my own feeling is that we have to look at the positives and use the decision to work both within Europe and further afield.”
O'Neill says his company has absorbed the additional cost of the rate changes, but with the dollar some product discounts have been reduced. “In the long term it will be difficult to pass additional cost of the rate changes. But I am sure things will settle down again as the markets became more confident that a Brexit deal to suit all parties will be achieved. As for the Brexit result, until Article 50 is triggered we are in a period of uncertainty,” he says.