Cameron veto unnerves Midlands manufacturers

THE West Midlands manufacturing industry faces a period of further upheaval until the woes in the Eurozone are resolved, a Staffordshire firm has said.

Tony Hague, managing director of Cheslyn Hay-based PP Electrical Systems, said it remained concerned by David Cameron’s decision to veto the euro deal because a large part of its business relied on strong trading with Germany.

“We have to be concerned by the decision and its wider implications. We only opened a new sales and marketing operation in Germany six months ago because of our strong business there,” he said.

“Anything that jeopardises the success of that venture will have a major impact on our business so we are keeping a close on things.

“That being said, I think it’s still early days yet and so no one really knows yet what will happen. We just have to carry on as normal and hope that things will be resolved for the best.”

PP Electrical Systems, which builds complex control systems for machine automation and is part of the MAN manufacturing alliance, is just one firm in the region to have strong trading ties with Europe, particularly with Germany.

“Our links with Germany are vital and we don’t like to think of our colleagues there and in France working without us,” added Mr Hague.

Nevertheless, he said he did not blame the Prime Minister for the situation he had been presented with.

“He was caught between a rock and a hard place and he needed to protect our position but knew that would cause problems. However, he may have been influenced by the need to protect the financial institutions.

“We now have to carry on but we are set for a difficult period and until the uncertainty is resolved then the whole manufacturing sector will be concerned.”

Mr Hague said 25% of his firm’s total sales were due to exports with Germany and so anything which threatened them, particularly in the current climate was of concern.

The firm, which employs 210 people and has a turnover around £24m, is targeting growth of 20%.

“A lot of our growth over the next five years won’t come for the UK but will increasing be due to business in Germany and other export markets such as Asia and the United States. Therefore we want to protect our business as much as possible,” he added.

John Cridland, CBI Director-General, said: “British business acknowledges the pressure that the Prime Minister was under at the EU Summit, given the refusal of European leaders to recognise the UK’s legitimate concerns.

“But businesses want the recriminations to stop while the UK moves swiftly to secure our influence in the single market. 40% of UK trade is with the Eurozone economies and thousands of jobs depend on it.

“The Coalition Government must re-double its efforts to ensure that the UK is not put at an economic disadvantage.”