Corporate Magazine - 2013, June (PDF) - Invest Northern Ireland

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20 June 2013 InvestinSpotlight on Business and Sector DevelopmentSPOTLIGHTElectronics and EngineeringHigh ValuecommitmentThe manufacturing sector in the UK has undergone a seismic change in recent decades.With countries such as India and China offering low cost manufacturing capability and extensive capacity, companies here, includinginward investors, are often faced with the choice of relocating operations elsewhere or making the move to higher value activities.Two companies that have shown resilience and long-term commitment to Northern Ireland are Seagate and Caterpillar Inc,both international leaders in their fields. Backed by Invest NI they have navigated the unsettled economic tides, and, despitechallenging times, continue to reinvest in their Northern Ireland operations and provide high value employment.SeagatePart of the global storageleader, Seagate Technology, theSeagate facility in Springtown,Londonderry, develops andmanufactures read-writeheads for hard disk drives. It isrecognised as the UK’s mostadvanced nanotechnologyscalemanufacturing facility andemploys over 1,300 staff.The company recently celebrated the 20thanniversary of its arrival in Northern Irelandand took the opportunity to restate itscommitment to the region.“Our confidence in the high quality of talentavailable here has never wavered and ourexperience over the last 20 years has beenvery positive. We have developed a highlyvaluable strategic partnership with Queen’sUniversity through the Ansin project and alsoacknowledge the importance of Invest NI’ssupport over the years. We remain committedto maintaining a presence in Northern Ireland,”said Dr Brian Burns, Seagate’s Vice Presidentof Springtown Operations.Over 20 years Seagate has invested more than£480 million in its Northern Ireland facilities.To complement its Springtown facility, it setup an operation in Limavady in 1996, SeagateTechnology Media (Ireland), to processaluminium substrates for disc drives.Research and development is at the heart ofSeagate’s success and over the last 10 yearsthe company has made a series of major R&Dinvestments. In 2004 it invested £90m, backedby Invest NI, in a project at Springtown todevelop new technology to increase thestorage capacity and performance of harddisc drives. This was followed in 2005 byan £83m investment in both the Derry andLimavady plants, which created 300 new jobs,and was again supported by Invest NI.John Hood, Director of Invest NI’s LifeSciences, Electronics and ConsumerProducts, comments: “Seagate recognisedthat Northern Ireland presented a costeffectivelocation and one where skilledstaff of the calibre it required were readilyavailable. It consolidated its presence here byreinvesting and building up the capability ofits workforce.”Unfortunately the global economic downturntook its toll on Seagate, as on so many otherbusinesses, and in 2008 the company wasforced to close the Limavady plant due to costpressures from the Far East.However, Seagate continued to invest in thehighly successful Springtown plant, makingtwo further major R&D investments in 2010,totalling almost £60m.>> Pictured at the Seagate 20th anniversary dinner are (from left): Alastair Hamilton, Chief Executive, Invest NI;Brian Burns, Vice President Seagate Springtown Operations; Dave Mosley, Executive Vice President, Operations,Seagate; Arlene Foster, Enterprise Minister, and Jeff LaCroix, Vice President, Recording Head Operations, Seagate.The investments, supported by Invest NI,created 85 R&D jobs in Springtown and afurther 10 related research posts at Queen’sUniversity, Belfast. It enhanced the size, scaleand nature of research undertaken at theSpringtown site and underpinned the strategicimportance of the Northern Ireland facility. Italso strengthened the relationship betweenthe company and the university which led tothe establishment of Ansin, a state-of-the-artresearch facility located within Queen’s Schoolof Mathematics and Physics, to focus on thedevelopment of advanced materials.Seagate donated equipment valued at£7.5m and provided £250,000 to fundbusiness development activities in Ansin.Speaking at the opening in 2010 Dr KennethAllen, Seagate’s then Vice President ofDevelopment, said: “Ansin provides a uniqueopportunity to make a difference for NorthernIreland and for Seagate in the long term. Byestablishing this initiative, we hope to providethe spark which leads to a stronger base ofmagnetic and nanotechnology capability.We look forward to broadening our strategicpartnership with Queen’s and Invest NI.”The joint venture with Queen’s reflectsSeagate’s ethos of actively promoting scienceand engineering in education. It has beeninvolved in a range of initiatives including theSeagate Real World Science Conference,a summer school and school visits. Thecompany estimates that the combinedelements of its school outreach programmeinvolve more than 1,200 students each year.John Hood comments: “Seagate’scontribution to Northern Ireland goes wellbeyond jobs created. It is actively involvedin the community and despite the difficulteconomic climate has continued toreinvest to protect the 1,300 high value jobsin Springtown.”
Spotlight on Business and Sector DevelopmentInvestin June 2013 21SPOTLIGHTElectronics and EngineeringCaterpillarCaterpillar has beeninvesting in Northern Irelandsince 1999 when it acquiredlocal family business FGWilson (Engineering) Ltd.The company manufacturesa range of diesel and gaspowered generators for bothdomestic and commercialapplications.In 2005 Caterpillar announced that it wassetting up a shared financial servicescentre based in Northern Ireland toservice its network of companies acrossEurope. The investment, backed by InvestNI, expanded the Caterpillar presence inNorthern Ireland into the services sectorand was a direct result of the positiveexperience the company has enjoyedhere since its arrival.Speaking at the time Walter Jess,Financial Shared Services Manager ofCaterpillar Compact Power Systems,commented: “We are setting up this newoperation to enable us to centralise andstreamline key financial services which arecurrently handled independently. Beforeselecting Northern Ireland we looked intoa number of different locations. However,Northern Ireland emerged as our preferredbase of operations because of the highlyskilled population and strong work ethic.”The “quality of personnel” was citedagain later in 2005 when Caterpillar setup a second shared services centre todeliver centralised information systems,services and support to other parts of theCaterpillar organisation.At the same time the company continuedto invest in its manufacturing operationsin Larne, Springvale (Belfast) andMonkstown, investing a total of £36mover the period from 2004. This includeda £10m investment in a new engineeringresearch centre at Larne and moving fromcellular manufacture to flow line assembly.Caterpillar also further developed itslean manufacturing techniques acrossall three sites, focusing on reducingwaste in assembly, manufacturing andlogistics processes. In 2010 it launcheda new 47,000 sq ft assembly line whichrepresented a further £5m investment atthe Larne plant.By the end of 2011 Caterpillar wasemploying around 3,000 staff acrossits three operating sites. The globaleconomic climate however, was growingincreasingly challenging, and a year laterthe company announced significantredundancies from its workforce inNorthern Ireland.“Caterpillar took this difficult decision inthe face of increasingly competitive globaleconomic pressures,both in terms offalling demand andincreasing costcompetition,”says JohnHood.“Invest NI Chief Executive, AlastairHamilton, and the Enterprise MinisterArlene Foster met with Bill Rohner,Vice President of Caterpillar’s ElectricPower Division after the redundancyannouncement to identify anyopportunities to mitigate job losses anddiscuss options. Soon after, Caterpillar,supported by Invest NI, announced itwould continue to expand shared servicesin Northern Ireland, which will create 200high quality jobs.“Caterpillar’s commitment to NorthernIreland is evident from its history ofinvestment here. It took a strategicdecision to move lower value activitiesoverseas and to retain its high value workin Northern Ireland, and has diversifiedits base here to include services.Invest NI will continue tosupport it in theseareas,” adds JohnHood.>> Pictured at the recent investment announcement are (L-R): Dr. Stephen Farry, Minister of Employmentand Learning. Robert Kennedy, Caterpillar NI Operations Director, and Arlene Foster, Enterprise Minister.
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