Share1,200 staff to lose jobs; Deloitte exploring options for business
BELFAST: Wrightbus, maker of London's red double-deckers and one of Northern Ireland's largest manufacturers, was placed into administration yesterday with almost all of its 1,250 staff losing their jobs, administrators Deloitte said.
Trade union Unite called on British Prime Minister Boris Johnson, who as mayor of London bought a fleet of 600 so-called "Boris Buses" from Wrightbus in 2012, to intervene and nationalize the company. "Despite extensive efforts over recent months it has not been possible to find a buyer who wanted to maintain the business as a going concern," said Michael Magnay, joint administrator, who will oversee a form of creditor protection that often precedes bankruptcy.
Wrightbus is best known for supplying New Routemaster buses to Transport for London (TFL) under the mayorship of Boris Johnson, who is now Britain's prime minister.Based in Ballymena, Northern Ireland, the company is one of the province's largest employers.
The administrators will "explore all remaining options for the business and assets, and would encourage any parties with an interest to contact them," he said, adding that 1,200 of 1,250 staff had been made redundant. Management met with staff and unions yesterday morning to announce the decision.
The Unite trade union said staff were devastated by the move and it was now up to the British government to step in. "Prime Minister Boris Johnson has made great play about how he stands strong for British industry," Unite Regional Secretary Jackie Pollock said.
"We call on Boris Johnson to 'take back control' and nationalize to invest in securing UK bus manufacturing capacity." The British government's Secretary of State for Northern Ireland Julian Smith said in a Twitter post he had been holding talks about Wrightbus' fate. "I … continue to do all I can to support Wrightbus and its employees," he said.
Financial woes
Parent company the Cornerstone Group slipped from a profit of 10.9 million pounds in 2016 to a loss of 1.7 million in 2017, the last year it filed accounts for. In accounts published last year, it cited uncertainty in the UK market for new buses and the pressure of increased material prices due to a weaker pound.
It also disclosed a 4.1 million pound donation "to fund the group's commitment to Christian, evangelical and other charitable activities." In 2016 Wrightbus founder William Wright was the first major business leader in Northern Ireland to publicly back leaving the EU.
Local member of parliament Ian Paisley, whose Democratic Unionist Party campaigned for Brexit, yesterday denied that Britain's decision to leave the European Union had had an impact on Wrightbus, noting that its biggest customers were in the United Kingdom. Paisley described the decision to enter administration as "an absolutely tragic body blow." But he said he expected the administration process would attract a buyer. Wrightbus launched a new-look Routemaster in London in 2012 to much fanfare, but the bus later attracted some complaints. In 2016, Johnson's successor as London mayor, Sadiq Khan, said in a written answer to public questions about the bus, "Londoners deserve a green, affordable and functional bus fleet, which is why I will not be purchasing any more New Routemasters." The London Assembly later cited problems with the batteries and bus capacity. But in May of this year Transport for London announced it had ordered 20 new zero-emission hydrogen-powered buses from Wrightbus. The company also had customers in Ireland, Singapore and Mexico.
As recently as 2016 the firm was awarded a £62 million ($77 million, 70 million euro) contract to produce the vehicles for the streets of the capital. The iconic red "double decker" vehicles with a sleek updated design were dubbed "Boris buses", becoming a flagship project for the capital's then-leader.
