Examination of Witness (Questions 173-179)
MR CHRIS
GATELEY
21 MAY 2009
Q173 Chairman: Can I begin with an apology
that we are running rather late, it took us a little longer than
we expected to get round Leyland this morning to see the trucks.
I apologise for keeping you waiting. Can I ask you to begin with
a general question. Could you just say who you are for the record.
We have got a written brief about Multipart and we know your business,
but just paint a picture for us about the business and then we
will move to more structured questioning.
Mr Gateley: My name is Chris Gateley,
the Managing Director of Multipart Solutions Limited. Multipart
has been in existence probably since the early 1900s in one form
or another. It came from the old Leyland organisation many years
back. It was the after-market part of Leyland, DAF and LDV when
there was the original organisation, but in 1993 when DAF went
under it gave the management of the company at the time the opportunity
to buy into and break that group up, so you ended up with DAF,
Leyland, LDV and Multipart. Multipart started as a statutory entity
in 1993 and since that time we have moved away from Leyland and
DAF as they were bought by PACCAR and their philosophy is to do
with the after-market in-house rather than outsource it. We have
had strategies in the last 10 years thinking we cannot survive
on LDV alone, so how do we take the core competency of our business
and move it elsewhere. We do not manufacture anything. We do not
manufacture vehicles and we do not manufacture cars, but we effectively
provide the after-market solution to all of our auto and defence
clients by sourcing parts, deciding how many parts we should buy
and hold in our inventory, so we take the inventory as our own
risk, we buy them, we store them, we wait for the demand from
the dealership network or customers and then we send those parts
out as and when they are demanded. It is a unique business. It
is a bit like Unipart for Jaguar. It is never going to win Ford,
General Motors or PACCAR who decide "our philosophy is in-house"
and the only bit they would outsource is what we call trucks and
sheds, which is borrowing the shed and the truck and getting the
parts out to the customers. All the intellectual bit around what
parts, how many parts, how we should do it, where we should buy,
that is done by Multipart. We are the parts division of many of
our clients.
Q174 Chairman: Just to be clear,
in the defence sector it is the transport interest that you service
as well?
Mr Gateley: No, it is exactly
the same. In the defence sector we have contracts with the Ministry
of Defence for heavy-armoured spares provision for the Challenger
tank, the Rapier missile—not the missile but the launcher—and
all of the MoD's construction fleet throughout the world. We do
exactly the same for the auto. We will go and think, "What
do they need? What is the probability of something breaking down?
Why has it broken down? What is the part to fix it?" because
by six o'clock every night in the auto sector we have to have
a part there pre-nine tomorrow morning, or in the defence sector
it is 24/7 365 days a year.
Q175 Chairman: In the automotive
sector your work is concentrated on commercial vehicles?
Mr Gateley: We have the TVR sports
car but the rest are commercial vehicles around LDV, Isuzu trucks,
Dennis Eagle bin wagons, and we have just won the Optare bus and
coach contract and also the Modec electric van.
Q176 Mr Hoyle: First, can I say thank
you for remaining in Chorley. You have got your new facility in
Chorley.
Mr Gateley: We are very proud
of it.
Q177 Mr Hoyle: It proves that you
are investing in the future and the region. Thank you for that.
What is the long-term future for the UK automotive industry as
you see it? If you could just give us a quick overview of how
you see the industry.
Mr Gateley: For the poor manufacturers
or non-viable it is bleak, and it should be. I am a very strong
believer in supply and demand and if a person cannot quite make
it they should go. It is very difficult short-term for the stronger
viable ones, but longer term I think it is a good future for the
likes of PACCAR, et cetera. It is very disappointing for
the small very innovative companies, like Modec, where they are
investing in something green and new and probably do it very much
on their own as opposed to getting any support. They have been
hit with difficult times and are probably 20 years ahead of themselves
in terms of the marketplace. For those who are struggling at the
minute, they need to go. That will be good for those who actually
have a longer term future because they will take that volume into
their own account. For the small innovative organisations, and
suppliers as well, the battery suppliers, as an economy that is
where we should be investing.
Q178 Mr Hoyle: So has the Government
got it right to actually support their vision for a low carbon
vehicle for the future? Is that right for now?
Mr Gateley: I think it is right
for now but you have got a very difficult future because as a
culture and a country we probably want to buy on price and the
best part, not quite the European philosophy and, as I know, if
I take the battery side, when you look at the price of the battery
side of commercial vehicles, Optare coaches, the costs are so
prohibitive I cannot genuinely see any commercial reason why you
would want to go and buy into a vehicle that does all the right
green things but commercially is not viable at the moment. That
is why I say you are probably 10 or 15 years ahead of yourself
or pointing investment in the wrong area.
Q179 Mr Hoyle: Obviously there was
great concern over LDV Vans, you hold the parts for LDV vans,
and there is Team Leyland, which is the export van of LDV Vans.
Do you think there is good news to come?
Mr Gateley: For LDV?
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