1 ;ardner: What next?
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The news that Perkins is going ahead h its plans to buy Gardner from wker Siddeley confirms one of the st persistent rumours and worst-kept Tets of the engine business. It is a ult of the collapse of the bus market 3ritain and of Cummins' successful nch of its 1,10 10-litre engine nearly r years ago, but it is too early to tell v Gardner is going to fit into the rkins empire.
H'erkins, part of Canadian-owned Mas, Ferguson but firmly a British corniy, already has engines across most ver ranges of the automotive market. Peterborough plants turn out engines rn 1.8 to 10.5 litres in swept volume, h three, four, six and eight cylinders, .ree and in-line formation and with out s of 2.6kW (3.5hp) to 200kW (268hp). e impending launch of its Prima range direct injection two-litre light commerI and car engines primarily for Austin ver will further enhance its volume duction range.
'erkins Shrewsbury, the Rolls-Royce sels division bought two years ago m Vickers for £20 million, took the npany into the heavy end of the ene market with a range running from 2 to 32.7 litres and with power outs of 112kW (150hp) to 894kW 200hp).
3ardner sits in the middle, building
six and eight cylinder engines with ver outputs ranging from 112kW ()11p) to 298kW (400hp). It is losing rket share and money, has production lities in Manchester, so why is 7kins buying it?
iome answers to that may emerge en we know how much Perkins is ing for Gardner and whether the Dur force, falling from 660 to 530 by end of June, will be trimmed further. or the time being, Gardner is to be autonomous division, selling only
through its own outlets and with its own . personnel. That may change.
Although Hawker Siddeley has spent several millions on new production facilities for Gardner, and has funded and developed the higher powered 6LYT range, the acquisition of the company in 1977 has ceased to produce the returns which please its parent.
Of the 2,000 engines it sold last year, 1,227 were for buses and a few coaches, 489 were for trucks and 284 were industrial and marine engines.
Only the industrial and marine sales have grown in recent years — from 198 in 1982 — and although the bus and coach sales are largely equal to 1982's, they are expected to plummet with bus building this year and next. Truck engine sales are down from 835 in 1982, but the company thinks it has turned the corner with improved availability of the 6LYT.
What has caused the extra damage is the LH), which has taken Cummins into the bus and eight-wheel tipper markets which hitherto had little use for its 14
litre range. The 2,015 LlOs fitted in 29 tonne-plus tractive units and rigids last year gave it market leadership in that sector.
Even when the bus industry starts buying again, the omens for Gardner are not good, for the option of Cummins power will come along with Scania and Volvo buses, with their own engines, being sold hard.
The story has parallels in the eightwheel market. Of the companies growing in the market, Volvo, Oaf, lveco, MAN. Scania and Mercedes-Benz (the latter two new to the market) are exclusive users of imported and largely in-house engines. Leyland, the market leader, uses more Gardner engines in its Constructor 8s than Leyland engines, but it is a far bigger user of Perkins Eagle and Cummins L10 engines.
That leaves Foden (down to 11% of the market last year and about 12% so far this year), ERF (7.5% last year and about 6.8% this year) and Seddon Atkinson (5% last year and about 4.8% this year) taking Gardner engines along with Eagle, Cummins and — in the case of Foden — Caterpillar engines. It is not a lot to fight for, especially when one remembers that Perkins already sells 400,000 engines a year, many made overseas.
If nothing else, the takeover will achieve three immediate objectives. Hawker Siddeley will be relieved of a subsidiary which has ceased to do it many favours financially; Perkins will get a name which is synonymous with excellence in automotive engineering; and the British commercial vehicle diesel engine industry will be reduced to two multinational groups, Perkins and Cummins.
It is likely to achieve more if Perkins is to consider the deal worthwhile.
• by Alan Millar