Crane-maker looking upwards

For this month’s Success feature, in conjunction with the North East Chamber of Commerce, Lindsay Parker pays the firm a visit.

RALPH SAELZER’S vast office window overlooks the River Wear as it snakes past the Stadium of Light. It’s a dramatic, if industrial, view. Seagulls swoop in and out of the large crane parked outside, cawing over the stacks of raw material piled below.

The former shipyard at Ayres Quay is buzzing with energy, the 215 workers at Liebherr Sunderland Works Ltd busy making the 180 cranes which are manufactured every year for the maritime, offshore and harbour industries.

While many of its heavy engineering brothers have gone out of business, Liebherr is going from strength to strength and was recently honoured with a Queen’s Award for Enterprise in the international trade sector.

“We are the last remaining heavy engineering company in the area of Sunderland,”

says Mr Saelzer, Liebherr’s German-born managing director.

“The market may have flattened out a bit, but new orders are coming in.”

Liebherr has been on the banks of the River Wear for 20 years. It began as a subsidiary of its Austrian-based parent company, Liebherr-Werk Nenzing GmbH, and in 2000 started trading as a limited company.

Over the years, the business has expanded; its imposing manufacturing space has been extended, and the Liebherr name has become known for providing quality cranes across the world.

Turnover last year was 56 million euros and overseas sales have increased by 46 per cent since 2005.

“Most of the cranes are for the export industry, with China, Singapore and South Korea accounting for more than half of our export sales,”

says Mr Saelzer.

“Europe is also a strong area, specifically shipyards in Germany, Turkey and the Netherlands.

“In Britain we’ve delivered cranes to Aberdeen, Great Yarmouth and Hartlepool.

“When we first began, we found the North East Chamber of Commerce helped us a great deal with some of the exporting red tape swiftly and efficiently and now nearly 90 per cent of our business is exported.”

Mr Saelzer arrived at Liebherr Sunderland in 2002, where he was impressed by the friendliness of the North- Easterners and their worldrenowned skills in the heavy engineering industry.

“One of the reasons we took over this old shipyard was its proximity to the coast, so that we could send shipments, but the main reason was the skills of the workforce,” he says.

“The platers and the welders, the fitters and the electricians, were available without the need for investing too much money in training. We have six people who still work here who have been with us since day one.”

IT is the workforce that has enabled the company to grow. During its two decades, dips have come as a result of not being able to find workers with the right skills for the job, which led Liebherr to start taking on its own apprentices.

“We have struggled to find workers with the right skills sometimes and there seemed to be very little effort being made by the Government at times to enhance them,” he says. “So we decided to set up our own apprenticeship scheme. We now have 26 apprentices on site, all of them local.

“Our machinery is identical and the workforce is skilled in the same way, so that projects can be undertaken either at Sunderland or at our other factories in Austria and Germany, which employ 1,700 and 1,000 people respectively.

“We also have an exchange programme in place, so that our workers and apprentices can go to Germany or Austria, and vice versa. It’s been very successful and we have constantly enhanced the programme over the years.”

Indeed, one apprentice, 20- year-old Harry Klein, has been shortlisted to represent Britain at the finals of the Worldskills 2009 competition – dubbed the tradesman’s Olympics – in Calgary, Canada, in September.

Mr Klein will compete against professionals from 48 countries after Liebherr entered him into a SkillWeld competition and The Welding Institute recognised his talent.

“We have a very good relationship with our workforce and, as well as the apprenticeships, we can provide funding for staff to pursue degrees and other qualifications,” says Mr Saelzer.

The family-like ethos has been filtered down from the parent company and, in turn, the Liebherr Group, which is still run by the second generation of Liebherrs and is about to pass to the third.

The group was founded by Hans Liebherr in 1949 and today comprises more than 100 companies, with more than 32,000 employees. The group’s turnover last year was 8.4 billion Euros.

The Liebherrs invested 750 million Euros in new plant and equipment last year to ensure that their cranes keep their reputation as being among the best in the world.

The success of the company, says Mr Saelzer, stems partly from their direct sales strategy, using a network of 26 sales offices directed by the parent company in Austria.

“They’re not being sold through dealers, our sales people deal directly with the clients and that gives them a comfortable feeling,” he says.

“Our order book is full going into 2011. We’re still working overtime and still working weekends. On every fourth ship you see on the ocean, a crane will have been built in Sunderland and they’re renowned for being a quality product.

“We’re up to 30 per cent more expensive than our competitors, but the clients are prepared to pay it because they know the quality is there.

“The product must be spot on. It must be able to lift the capacity that’s required and it has to perform in all environments. Offshore cranes, for example, can be operating in the tropics or in arctic temperatures of -50 degrees in Russia. But that’s the strength of our product.”

IN 1999, Liebherr Sunderland was producing 67 cranes per year. Today that figure is up at 180. The business has benefited from the offshore industries as the demand for oil has increased.

With it, has come new areas of oil exploration such as in Brazil, a world leader for deep water drilling.

Liebherr also has a strong reputation for delivering specialised cranes, particularly for the offshore industry. One crane, for example, is flame sprayed with a protective aluminium coating which is anticorrosive and can withstand high temperatures.

And there are various ways to despatch them. Some are sent on barges which, although more expensive than by road, means they are already assembled and can be set to work immediately.

Liebherr’s biggest crane built at the site in Sunderland – the MTC 6000 – has a lifting capacity of 150 tonnes and an outreach of 73 metres.

The word-of-mouth success of the business has seen its overseas sales increase by 46 per cent since 2005, equating to almost £12m of exports. The recent Queen’s Award for Enterprise recognises the firm’s success.

“It’s a great achievements and I know that the workforce is very proud of it,” says Mr Saelzer. “They’re also getting recognised within the wider picture, among their peers in Austria and Germany, and it’s good for the region and for Sunderland.”

The signs are the company will continue growing and being a jewel in the North- East’s manufacturing crown.

Mr Saelzer enjoys his view of the Stadium of Light, hearing the workers turn the sheet metal into the high-quality products they are renowned for.

“When I get asked by my German friends and Austrian colleagues if I like living in the UK, the answer is always yes,” he says. “A lot of that has to do with the people. It’s not only because of the landscape and opportunities and skills, it’s the people. They make us successful."