Airbags International, one of Congleton’s longest standing industrial employers and which closed its Viking Way factory last year, has booked £9.9 million in losses for the year, largely driven by expected severance costs for its workforce.
The figure, disclosed in the company’s newly filed accounts, signals the end of airbag manufacturing in the town.
The company, part of the global Autoliv group, announced in 2023 that it was “evaluating” the future of its UK weaving operations. The latest report said that manufacturing had been transferred to Romania.
At the time of the report’s writing, the company was in the process of transferring assets within the group and selling off redundant equipment.
The directors said the UK operation would eventually “refocus” on technical and managerial support for Autoliv’s European and global activities, and while its registered office would remain in Congleton, the era of production is over.
Despite the looming closure, Airbags recorded strong trading figures in the year, seeing turnover rise to £76.9 million, up 13.8%, and gross profit at £23 million, up 20%. Average headcount rose to 242, up 12.6% from the previous year’s 215.
But the headline numbers were overshadowed by the cost of restructuring.
The company swung from a £1.1 million operating profit in 2022 to a £10.3 million operating loss in the year, almost entirely due to the provision for severance and closure related costs.
The directors made it clear that the losses were not a reflection of the firm’s trading performance but of the parent company’s global cost cutting programme, which aims to consolidate production in lower cost regions.
Autoliv announced a major global cost reduction plan in 2023. As part of that plan, the group began reviewing its textile weaving operations, including the Congleton site. The site has always been considered vulnerable to closure, with half made products shipped to Germany for processing and then transported back to England.
The report said the company was “managing the transfer of assets” to Romania and preparing for the “full plant closure”. The move was part of a broader shift in the automotive supply chain, with manufacturers increasingly relocating labour intensive processes to Eastern Europe.
The report said its workforce had been at the centre of discussions since the closure was first proposed. Management engaged with unions and employee representatives throughout 2023 and 2024, and a ballot on severance proposals was held.
The Congleton site has been a major employer for some years, supplying airbags to car manufacturers across Europe.
As we have reported, a Manchester real estate firm bought the now closed Airbags factory, with WUKPG managing director Oliver Lipson telling “Place North West” that the deal was an “opportunistic value add” opportunity. He said that “all occupation options” would be considered, including dividing the complex into smaller units.
While WUKPG did not disclose the purchase price, the factory was on sale at £10.75 million, with the company offering a £3 million sweetener by agreeing to lease it back for two years at £1.5 million a year.
The company began life in Leek, making seatbelt webbing. When it moved into manufacturing airbags, its small customer base expanded rapidly after it signed a deal with Ford, and it moved to Congleton to benefit from the town’s skilled textile workforce, initially on Bromley Road but later in the much larger, purpose built factory on the retail park.
The firm has left its mark on the town, with Viking Way and the Norse retail park among the nods to Autoliv’s Swedish roots.
(Photo: jll.com)
