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Ashok Leyland's UK arm shuts down 3rd plant

TE Narasimhan  |  Chennai 

Ashok Leyland’s UK subsidiary Optare has closed its Blackburn facility. The move is part of the company’s restructuring plan, which started in August 2009. The Blackburn facility is Optare’s third factory to down its shutters.

“The gates at Optare’s factory in Blackburn were closed to allow a final clearance of the site, bringing 80 years of bus manufacturing in the town to an end. However, the move marks the start of a new era for the company ... now reborn, re-energised and secure as part of global busmaker Ashok Leyland,” Optare said.

Ashok Leyland, along with its group companies, had in 2010 acquired a 26 per cent stake in UK-based bus manufacturer Optare. It had further increased the stake to 75.1 per cent last year.

The closure of the Blackburn facility is part of Optare’s three-year turnaround plan, which started in August 2009 with the closure of the Rotherham site, followed by the relocation of the Leeds factory in November 2011. With this, the company has consolidated its bus assembly operations in one facility at Sherburn in Elmet, Yorkshire.

“The benefits are already showing up with the production volumes ramping up, demonstrated by the latest UK bus registrations published by SMMT (Society of Motor Manufacturers and Traders), showing an increase of just over 50 per cent year to date,” Optare’s chief executive officer Jim Sumner said, adding that the task of progressively closing three factories and relocating to a single site had been an extremely challenging process.

“There were always going to be unpleasant elements, which I don’t take lightly. Clearly, in an extremely competitive market, the survival of the business has had to be my prime concern and this process has been a key element in turning the business around,” he said.

“Having everything on one site is undoubtedly the most efficient way for any business to operate and we have significantly reduced our overheads and operating costs as a result of this strategy.”

Under the new ownership of Ashok Leyland, Optare is now poised to realise the full benefit of this strategy along with the significant product investments made over the past three years,” Sumner said.

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First Published: Thu, May 31 2012. 00:06 IST