Leyland team pledges profitability

THE MANAGEMENT team that bought Leyland trucks out of receivership last week pledged yesterday that the business would be profitable from day one.

John Gilchrist, who led the four-man buyout team, also said that production at the Leyland assembly plant in Lancashire would grow by almost 50 per cent in the next three years as it returned to international markets and sought to win assembly business from other truck manufacturers.

Mr Gilchrist, chief executive of Leyland Trucks Manufacturing, the newly formed company that bought the assembly plant from the receivers of Leyland DAF, said: 'We will be profitable in each of the first three years.' With a workforce cut from 1,100 to 700, the plant could now break even on production of 4,950 vehicles compared with a figure last year of 11,000, he added.

Production at Leyland, which has an existing capacity of 18,000 trucks a year, is planned to rise from 5,500 this year to 8,000 in three years' time.

Although this is a far cry from the 14,000 trucks built there when the commercial vehicle market was at its peak in the late 1980s, Mr Gilchrist said the production forecasts were a conservative minimum.

Leyland hopes to build up production of specialist vehicles, such as the Comet, for international markets to at least 1,000 a year and hopes to win further military orders.

As well as the commercial trucks built at Leyland, headed by the 45 series, the plant also has to complete production of 2,000 four-ton army trucks and 300 Drops ammunition carriers for the Ministry of Defence.

Leyland also intends to offer its surplus capacity to other vehicle assemblers. 'We can offer other vehicle makers some of the best, lowest-cost and most efficient production facilities in Europe,' Mr Gilchrist said.

David Gill, managing director of Leyland DAF Trucks, the UK sales and marketing arm of DAF Trucks of the Netherlands, meanwhile forecast that the UK market for trucks over 3.5 tons would rise to between 33,000 and 34,000 this year - an increase of 5 to 9 per cent on 1992.

The market had been artificially depressed in the first half because of DAF's collapse into receivership in February following combined losses of 900m guilders ( pounds 330m) in the previous three years. But he expected it to bounce back in the next six months and that Leyland DAF would increase its 18 per cent market share.

Cor Baan, chairman of DAF Trucks, said that in its first year of trading after emerging from receivership in March, it expected to sell about 10,000 trucks.

The receivers are hopeful of finding buyers for the other Leyland DAF businesses still in receivership - the parts business, based at Chorley, Lancashire, the Albion axle works in Glasgow and the components and technical centre also based at Leyland.