Logistics: The choice in the wilderness: Technology has helped keep a Welsh firm ahead of the pack and well out of the rat-race
Sunday 25 July 1993
Nevertheless, Control Techniques has grown from three people to well over a thousand without moving its headquarters or main factories from this picturesque setting. It is now one of the world leaders in sophisticated controls for powerful electric motors - devices that have a market as big as the electric motor market itself.
Most surprisingly, while other companies were busy spreading their production capabilities round the world in the 1980s, Control Techniques was closing down factories it had acquired abroad and concentrating production in mid-Wales.
Trevor Wheatley, the chairman, believes it makes sense to get as many economies of scale as possible, and feels that Wales is as good a place as any to manufacture. 'One thing that makes me wild is when a financial institution says we won't be able to compete with the Japanese,' he said. 'That's absolute nonsense.' The group did start to manufacture in Singapore, Mr Wheatley said, 'but we decided that it was just as cost- effective to do it here.'
Now the company has four sites in Newtown, employing 400 people. One factory, which is being expanded, proclaims itself as the 'Control Techniques Drives World Module Assembly Plant'. Most of the units are made for other manufacturers; it would surprise most AEG customers, for instance, to know that the sophisticated German product they were buying was actually Welsh.
Although control drives are high value products and the company's production lines are as automated as any, Mr Wheatley does concede that Newtown's comparative remoteness has brought the group close to upping sticks and moving somewhere else in Britain, or even to America. This has happened twice recently.
As the company expanded throughout Europe, it became clear that a small aircraft would make sense. 'We were getting to a stage where travelling from here was becoming more inconvenient,' Mr Wheatley said.
Manchester, the nearest big airport, was an hour and a quarter's drive away. There was an airfield nearby, at Welshpool, but it was not adapted to take international flights. The company asked the Welsh Office to convert it, at a cost of pounds 1.25m, but was told that a cost-benefit analysis showed that this was not worthwhile.
Mr Wheatley was unimpressed. 'We liked it here but that wouldn't have stopped us moving because we desperately needed an airport,' he said. 'If we had found an acquisition with suitable offices, we could have moved and our Newtown business would have diminished by default.' Eventually Control Techniques helped to finance the airport itself, and its eight-seater turbo prop flies in and out of 'Welshpool International' almost every day.
In the other near desertion, it was the Welsh Office that came to the rescue. One of the group's biggest acquisitions was a dollars 50m company based near Buffalo, New York. 'It had 14 acres of fine industrial land; we seriously considered moving there,' Mr Wheatley said. But the Welsh Office suggested 'an attractive package' of new factories, which persuaded them to stay. In three to five years it will probably make sense to duplicate the Newtown operation in the US, but by then the Welsh factories will be even bigger.
The company has also used new technology to overcome its remoteness. It has a pounds 30,000 video conferencing studio, which is duplicated in five main locations round the world. Like a small television studio, it produces pictures of sufficient quality to allow technical problems to be examined and sorted out by remote control.
Only one geographical problem persists. After buying a company, it tries to persuade engineers to join its research and development centre in Wales. 'We've been quite successful with people from the US, but the Germans and Italians are not interested,' Mr Wheatley said. As a result, research and development is still spread about, although the biggest group is in Newtown.
Clearly, the Welsh tourist office will need to do a better selling job in Europe if Newtown is also to become a multinational centre of research.
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