Car giant McLaren bucks industry trend with turnover revving passed £1bn
Luxury car maker McLaren, which opened a £50m production facility in Sheffield last year, has defied the gloom facing the rest of the industry with a big jump in revenues.
Turnover increased 45% to £1.26bn in 2018, while the group also reported a significant reduction in operating loss for the business during 2018, improving from £43.4m in 2017 to just £4.8m in 2018.
The net result for 2018 is a loss after tax of £61.8m, from £66m the year before. Both the operating loss and the loss after tax is stated after charging £7.4m of one-off costs due to restructuring in 2018.
The group comprises three divisions, automotive, racing and applied technologies.
The group’s automotive division saw a 45% increase in global wholesales, with sales of 4,829 reported for 2018 compared to 3,340 for 2017, pushing revenues from £605m to £1.1bn.
McLaren’s automotive sales made up for the racing division where turnover fell from £209m to £133m after McLaren’s Formula 1 team fell to ninth place in the 2017 World Constructors’ Championship.
It said North America continues to be a strong market, with sales volumes up 43%, and now accounting for 36% of its global sales.
Sales in China also bucked industry trends and increased by 141%. McLaren said the launch of the McLaren 570S Spider and the McLaren 720S into China has been “highly successful”. It said only Rest of World recorded declining sales (down 7%) which was driven by the economic climate in the Middle East and Africa.
The group said its automotive division is well placed to face future uncertainties with a globally diversified sales structure supported by 95 franchised dealers globally and all products selling well in all markets,
“In particular, export markets outside of the EU represent an opportunity for growth and development,” McLaren said.
The company’s performance is in stark contrast to the rest of the industry which has been battling headwinds caused by Brexit.
Factory shutdowns put in place to mitigate any disruption caused by a March 29 Brexit saw UK car production in April fall by almost a half. According to figures from the Society of Motor Manufacturers and Traders (SMMT), 70,971 cars rolled off production lines in the month, down -44.5% year on year as the factory shutdowns took effect in many plants across the UK.
On the supply side, McLaren said strong supplier relationships underpin the supply chain, while the group said the recently opened McLaren Composites Technology Centre in Sheffield was an example of how the division is innovating in light weighting and carbon fibre composite manufacture.
The group said its applied technologies division’s planned growth has continues with year to date turnover of £64.6m, up 10.3% on 2018.
2018 saw the installation of seat sensors on Virgin East Coast trains start and also further successful testing and racing of the new Formula E car.
It said ongoing work in the autonomous vehicle development programme and development of sales prospects for its vehicle dynamic simulator continue.
