Express & Star

Cab Automotive turnover halved in 'challenging' year before takeover

Car parts firm Cab Automotive has revealed losing of a major contract that nearly halved its turnover and drove it to a £4 million loss in a 'challenging' year that also saw redundancies at the Tipton factory.

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Production work at Cab Automotive's factory in Tipton

The company has now been bought by part of German auto engineering giant Adler Pelzer and says it is now heading back towards the £50 million turnover mark.

In its accounts for 2016, just filed at Companies House, Cab Automotive reveals how the loss of a single contract at the start of 2016 saw its turnover for the year plummet to £28m from £58.5m the year before.

Average employee numbers during the year were cut to 305 from 352 in 2015.

CAB Automotive, based at 110,000 sq ft site on Vaughan Trading Estate, makes and supplies seating, interiors and parcel trays for both vehicle manufacturers and leading suppliers to the auto sector. Customers include Jaguar Land Rover, Bentley, Aston Martin and McLaren.

In the directors' strategic report, they said: "2016 represented a challenging year for Cab Automotive." the loss of the major contract, which represented nearly half of annual turnover, led to a restructuring and redundancy programme.

Operating profits fell from £2.4m in 2015 to a loss of £3.97m in 2016.

Efforts to win new work saw Cab Auto secure 17 new projects during the year; "However, despite these successes, the new business has not been sufficient to replace the loss of revenue and as a consequence Cab Automotive undertook both a restructuring of the management team and started to look for a new partner."

This resulted in the takeover by Pelzer in July this year.

Meanwhile the company has continued to win work but, while some are now at the manufacturing stage, some contracts will not come on stream until 2018.

Looking ahead, the directors said: "The company has won new contracts which will further the growth of the company to over £50 million turnover.

"The board of directors is aware of the huge impact this has on our resources and must pay tribute to its loyal and skilled workforce in meeting these higher output levels."