More than half of the UK engineering companies supplying high-profile motorsport competitions have seen an increase in sales over the past financial year.
Data from the Motorsport Industry Association’s (MIA’s) latest Motorsport Business Survey shows this UK industry experiencing increased output, increased investment in research and development (R&D) and an upturn in job opportunities for skilled engineers and apprentices.
According to MIA, of those that saw an increase in sales turnover, more than 10 per cent saw a rise of more than 50 per cent, compared with the previous financial year. More than half of UK motorsport engineering companies reported having higher-value future-order books, year on year, despite the global recession.
Such optimism is reflected in the amount of investment going into R&D, according to the MIA report, which confirmed that 17 per cent of motorsport engineering companies invested more than 30 per cent of their turnover on R&D and 25 per cent of businesses invested between 15 and 30 per cent.
According to MIA, this investment in R&D has been encouraged by the government’s tax credit scheme, which has been claimed by 55 per cent of motorsport engineering businesses in the last three years. Commitments to R&D programmes have consequently helped motorsport companies diversify into new markets.
Williams F1 has diversified into low-carbon technologies and kinetic energy recovery systems in recent years.
Alex Burns, chief executive officer of Williams F1, said in a statement: ‘Our decision to exploit our assets more widely, by diversifying into other sectors, particularly low-carbon, has significantly improved the security and strength of our business plans. We look forward to 2013 with cautious optimism.’
Similarly, new business has been secured in complementary market sectors such as defence, aerospace and marine, providing UK motorsport engineering businesses with growth opportunities.
According to the MIA, 80 per cent of motorsport businesses now export, with 22 per cent claiming that overseas sales accounted for more than 50 per cent of their turnover.
While the US was identified as the single largest export market (comprising 24 per cent of all exports), it also remains the most attractive region for growth potential, with 42 per cent of businesses citing it as a key target. The 2012 MIA Business Report also recorded exports (seven per cent) to the Chinese market for the first time.
Chris Aylett, chief executive of the MIA, said: ‘The UK motorsport industry is clearly bucking the pessimistic trend in manufacturing, but there remains frustration with some government inaction that holds back growth. Specifically, endless red tape and the lack of a coherent growth strategy and of bank finance were identified as barriers to future rapid progress.’
Turning to employment prospects in motorsport engineering, the report confirmed that 56 per cent of companies had increased their headcount during 2011–12 and that 62 per cent plan to recruit more staff in the next 12 months.
While such employment figures, and future forecasts for the UK motorsport engineering sector, are encouraging, the inability to recruit the right calibre of engineer was also identified as a major threat to future expansion.
The annual Motorsport Business Survey from the Motorsport Industry Association was carried out between June and September 2012, with most respondents located in the UK’s so-called Motorsport Valley, where more than 3,500 companies are located.