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The future of Wrightbus

Following a deadline day deal to prevent the closure of the Wrightbus factory, has had devastating impacts on Ballymena and its workforce. agendaNi explains how a company that posted a pre-tax profit of £11 million as recently as 2016 sunk to the financial lows that made administration inevitable.

Wrightbus fortunes have fallen drastically from 2012, when they were the toast of Northern Ireland industry during an economic downturn. Having just delivered their fleet of double decker buses to Transport for London, what would become known as the Boris Bus went on to be featured on the popular television show Top Gear, where it raced against sportscars. Pictures of Johnson hanging from the chassis of such a bus in the company’s old Ballymena factory, while surrounded by senior DUP figures such as Arlene Foster and Ian Paisley Jr. are now commonplace in media stories reporting the downfall of the firm.

Financial pressures on the company were first reported in July of this year, with Wrightbus having to apologise to its staff, who had found out about the difficulties through the media. The company then confirmed that it had been working with Deloitte in order to try to find potential investors to protect its future.

The most-recently published accounts for the company show that Wrightbus suffered a loss of £1.7 million and financial troubles are understood to have worsened since then. 2017’s loss was a substantial downturn from 2016’s financial reports, when Wrightbus reported a pre-tax profit of £11 million. A note contained within the 2017 reports  said that uncertainty in the UK market had created a “challenging outlook” for all bus manufacturers, especially with material prices increasing due to changing exchange rates. The post-Brexit vote weakening of sterling has made it more expensive for firms such as Wrightbus to purchase materials priced in dollars or euro.

There has also been a more general downturn in the UK market for new buses, which has always been Wrightbus’s primary market. Figures from the Society of Motor Manufacturers and Traders show that the amount of new bus and coach registrations has fallen 10 quarters in a row and are currently 30 per cent lower than they had been at this time last year. The firm’s falling out of favour with Transport for London in 2016, after Labour’s Sadiq Khan had taken over from Johnson as Mayor of London, has not helped its performance. The firm offered two rounds of redundancies last year in February and June, when 95 jobs were lost; the reasoning given at the time was the low level of demand for new buses from the UK market.

Wrightbus, who employed 1,200 workers at its factory in Ballymena, traces its history back to the post-World War II days in the town. Founded in 1946 by Robert Wright, who had begun by making bodywork for vans, buses and lorries, the company was soon joined by Robert’s son William, who is credited with having transformed the company into the modern-day bus building giant it had become. Recognised as a pioneer of the low-floor bus or trolleybus, the firm expanded internationally, with buses made for countries as far flung as Hong Kong, Singapore and India. Business was deemed to be progressing well for the company as recently as two years ago when it moved its premises to the factory vacated by the cigarette company JTI, also in Ballymena.

It has emerged that while Wrightbus lurched from prosperity to crisis, the company donated a total of £15 million to the Green Pastures church and religious charity over six years. Jeff Wright, son of William and Wrightbus majority shareholder, is a pastor at the church. The £15 million is understood to have helped to fund the building of Green Pastures’ church and urban village complex known as Project Gateway.

It has emerged that while Wrightbus lurched from prosperity to crisis, the company donated a total of £15 million to the Green Pastures church and religious charity over six years. Jeff Wright, son of William and Wrightbus majority shareholder, is a pastor at the church. The £15 million is understood to have helped to fund the building of Green Pastures’ church and urban village complex known as Project Gateway.

In 2015, Wright told Mid and East Antrim Council’s planning committee, who were considering the application for the Project Gateway site, that to approve its building would mean “saying yes” to 1,000 jobs as Green Pastures planned to build an urban village, a church, housing, business parks, a hotel, a supermarket and communal facilities within the complex on the outskirts of Ballymena, minutes away from the new Wrightbus factory. The supermarket aspect of the plan had initially been rejected for fears that it would damage the vibrancy and viability of Ballymena town centre, but a reduction in size (from 6,100 square metres to 4,1000 square metres) saw the planning application pass by five votes to four.

The industrialist Darren Donnelly, who sold his and his father’s main business, SDC Trailers, for £100 million, had announced his intention to pursue a deal for the company and had held discussions with Wrightbus. However, it was announced in September that negotiations with Donnelly had broken down. Wrightbus said at the time that they were “optimistic and working hard towards getting the best possible outcome for the skilled workforce we have in Ballymena”.

In October, Jeff Wright announced that a deal had not been reached with the English industrialist Jo Bamford despite hopes that it was on the verge of being concluded. The issue holding up the deal was said to be farmland also owned by Wright that he deemed as not being part of the factory site. With the Wrightbus manufacturing business placed in administration in September, its sale is being handled by the administrators, but the Wrightbus factory is held by a separate company, Whirlwind Property Two, also owned by Jeff Wright. Whirlwind Property Two has not entered administration and is therefore Wright’s to sell and not the administrator’s.

However, a deal in principle was agreed the day after Wright’s comments, with Wright donating the disputed farmland to the Council as a “gift”. “This legacy gift is a tribute not only to my father, his father before him, and the Wright family members, but most importantly is a tribute to the generations of workers who helped build a proud manufacturing tradition in Ballymena,” he said in a statement.

It is believed that Bamford, whose father is chairman of the manufacturer JCB, had taken an interest in Wrightbus due to the expertise the firm had built in hydrogen and electricity-powered vehicles, which JCB has been keen to invest in as the market moves towards decarbonisation.

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