A Warwickshire based automotive parts manufacturer has set up its first factory in Germany, the car production capital of Europe. The site will produce parts for the German and British markets.
Automotive Insulations, who manufacture thermal and acoustic insulation components for companies such as Jaguar Land Rover and Bentley, has set up a second overseas operation Rheinland Insulations (RI), as part of their business strategy to expand into the growing European automotive market.
The RI Rheinland Insulations (www.rheinins.de/en/) site was set up at end of 2013 in Hilden near Dusseldorf. Over the past three months the company has gained the relevant quality accreditations and is currently manufacturing materials for car production in Germany, as well as being sent over to the company’s Rugby headquarters. RI is also producing materials for the construction and specialist vehicle markets to develop a European wide sales strategy.
AI’s first overseas site was set up in Sweden in 2012. Managing Director Jim Griffin explains how the process was simpler the second time around. “We learned a lot about setting up abroad from our experience in Sweden. We knew that it was essential to find the right local partners who bring important cultural knowledge, as well as a good network of customers and suppliers.”
Local inward invest teams assisted in finding everything for the new site, from property through to people and licences. “They basically helped us with everything that we needed to start a business. And best of all, it was free,” adds Jim. “The site has been modelled on the successful business practices of our UK business to provide a design to production service for customers across Europe.”
Germany is Europe’s largest car manufacturer, exporting more vehicles to the UK than any other country according to the German automotive association, the VDA. Some might say it’s a risky strategy for a small British company to set up in a country renowned for quality car production. However, early sales figures for the RI operation look encouraging.
“We already have over £3 million of business in Germany to place in this site by the middle of 2014,” explains Jim. “Weight reduction and sustainable production are currently major challenges facing the automotive industry which means that the products that we make are in increasing demand across the whole sector.”
RI develop, test and manufacture acoustic and thermal insulation materials for use in vehicle engine bays, interiors, underbodies and exteriors, including 3D moulded high temperature foams and semi-rigid and integral skin polyurethane foams. These materials can be used to make lightweight components such as full or partial bonnet liners, wheel arch liners, undertrays and bumpers.
To ensure the flow of supplies and products, AI enlisted the help of a local logistics company who specialise in exporting to and from Germany. Exact Logistics was able to help AI reduce their set up costs by advising on how best to pack consignments, outlining the most cost-effective strategy and providing an option where the company pay only for the space they use.