Failed sale of Wrightbus sees 1,200 jobs lost

03 October 2019 Consultancy.uk

The manufacturer behind Transport for London’s “Boris Bus” has seen 1,200 jobs lost, as professionals from Deloitte failed to find a buyer for the company in time to prevent its collapse. Just 50 jobs will be retained at Ballymena-based Wrightbus, which is the last UK-owned bus-maker.

Founded in 1946, over the coming years, Wrightbus had grown to employ more than 1,000 people, making it one of Northern Ireland’s biggest privately-owned employers. It was also one of the last major employers in the Ballymena area of County Antrim, following a major spate of closures in recent years. This saw building giant Patton, tobacco company JTI Gallaher, and tyre manufacturer Michelin all exit the location amid turbulent economic conditions – conditions which finally took their toll on Wrightbus in the summer.

With annualised losses running to approximately £15 million, a source close to the firm said Wright Group's most recent accounts recorded a pre-tax profit of about £1.5 million, down from £10.7 million in 2016, making it “unclear” what the prospects are for Wright Group unless it can secure new financial backing. To that end, the company drafted in advisors from Big Four firm Deloitte to weigh up the firm’s options. The professional services firm began advising Wright Group on talks with prospective investors in July.

Failed sale of Wrightbus sees 1,200 jobs lost

While City insiders told the press that a number of turnaround funds were approached to gauge their interest in injecting tens of millions of pounds into the family-owned company, it soon became apparent that another course of action was also on the cards. As it emerged that Deloitte was working on "restructuring" options for the Northern Irish bus-maker, Unite, which represents workers in Wrightbus, said the news had "given rise to concerns among the workforce" and they would seek an urgent meeting.

“Wrightbus is a major employer, and reports that the company is seeking new investors have given rise to concerns among the workforce and the wider Ballymena community,” Regional Officer George Brash said. “Unite is seeking an urgent meeting with the company to address the genuine concerns which news reports have raised for our members. The workforce in Wrightbus deserve full transparency.”

Now, it appears that the union’s worst fears have been confirmed. Fewer than three months later, Wrightbus has appointed Deloitte as administrators, after talks with two potential buyers of the firm led nowhere. As a result, roughly 1,200 Wrightbus workers have been axed, with a mere 50 avoiding redundancy to assist the administrators with the continuing process.

The Wright family, who founded Wrightbus in 1946, said the firm had moved work from its facility in Malaysia to Ballymena in a bid to secure local jobs. However, in a statement, the family blamed "global changes from diesel to electric in bus technology” for resulting in significant losses at Wrightbus, “which our family have been covering for over a year." The family claimed it was “simply impossible” to maintain their support for the company amid those conditions.

Union officials meanwhile called for the immediate intervention of the British government, demanding that Northern Ireland Secretary Julian Smith should "stand up for British industry." The UK Government, however, typically takes a laissez-faire approach to administrations, in sharp contrast to the devolved Scottish Government. This was recently illustrated by the work done by Deloitte to secure the future of the Ferguson shipyard in Port Glasgow, brokering a deal with the Scottish Government to see the yard nationalised if a buyer was not found within four weeks.


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