The recent announcement by Bentley that its Crewe headquarters is to become the centre of excellence for the Volkswagen Group for all W12 engine production from the end of 2014 onwards served to further underline the strength of the UK’s engine manufacturing sector. In this month’s management briefing, Calum MacRae considers this burgeoning sector and its prospects. Part 2 puts the UK’s automotive engine producing sector in European perspective.
Future planned investments for UK engine manufacture look set to give the sector a secure future. Not only is there the investment in Bentley’s W12 production and Hams Hall preparing to ramp up output of BMW’s new three-cylinder petrol engines, but there is the additional prospect of JLR, from January 2015, once again manufacturing engines in its own facility for the first time since the Radford plant closed its doors in 1997.
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Initial capacity at the GBP505 million Wolverhampton plant for the AJ200/Ingenium petrol and diesel four-cylinders is set at some 450,000. However, with the AJ200’s design understood to be of a modular architecture it would not be a surprise to see three- and, perhaps six-cylinder engines, added to the plant’s production plans as alluded to by Wolfgang Ziebart, Jaguar Land Rover’s group engineering director recently. Such additions might necessitate a capacity hike at Wolverhampton in the future. The addition of three-cylinder variants of the AJ200 would mirror the strategy earmarked by Volvo for its VEA/Drive E engine family, which is believed to be of a similar make-up to AJ200 due to shared historical gestation. As Derek Crabb, Volvo’s VP of powertrain engineering, told ETi recently “We’re laying down an architecture for the future…so clearly we’re thinking about three-cylinders…two-cylinders and range extenders too.”
While the UK’s engine industry seems relatively buoyant, how does it place with the rest of Europe? According to data compiled for this feature, the UK placed third in a European Union engine manufacturing league table behind only Germany and France, which produced 4.6 and 2.7 million engines in 2013 respectively. The fourth place in the table, shown below, is taken by the European Union’s real engine manufacturing powerhouse – Hungary. Hungary is regarded as an engine manufacturing powerhouse as the sector towers over the country’s vehicle manufacturing volume; in 2013 nearly 2.3 million engines were produced an amount significantly more than the 310,000 light vehicles that were manufactured according to the VDA. Hungary is home to only two major engine manufacturing plants – GM’s Szentgotthard facility and VW Group’s/Audi Hungaria’s Gyor plant.
The Gyor plant has the distinction of being the largest engine plant of this selection, and according to Audi Hungaria the largest in the world, producing over 1.9 million engines in 2013.Gyor was originally opened in the early 1990s to produce Audi’s 1.8L 5v per cylinder engines, but since then – with Audi moving engine production away from Ingolstadt and the brand and group’s stellar growth – the plant has taken on a much wider remit successively adding six-, eight- and ten-cylinder engines.
Similarly, output at the GM plant at Szentgotthard could be set to grow with GM investing heavily in the facility. In 2011, a EUR500 million 500,000 capacity addition to the existing Szentgotthard plant was inaugurated. The first engine produced at the new plant was the 1.6L MGE (mid-size gasoline engine) designed to replace the Family I 1.6L previously also produced at Szentgotthard. Shortly, the plant will be one of five globally to build the new 1.0-1.5L family (variously called SGE [Small Gasoline Engine] or Microtec) in combined volume of up to 2.5 million per annum.
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By GlobalDataAs an engine manufacturing location Hungary has come to the fore due to two powerful drivers – its relative labour cost advantage and its proximity to its markets i.e. how close it is to VW Group plants in Germany and Central Europe. These are powerful factors that the UK could not have competed with when Ford decided to invest in UK engine manufacturing. Therefore, as the sector goes from strength to strength, and is increasingly underpinned by resurgent vehicle production, the UK engine sector has much to thank Ford for its resilience. Its investment has given the UK the technical know-how and resource base to continually strengthen its engine manufacturing sector and, as the years have shown, has added up to much more than just being thrown a bone.
For more on the UK engine manufacturing sector, see also:
April 2014 management briefing: UK engine manufacturing (1)
Charts: EU engine production numbers by country (2013) and by plant for major engine producing countries
Data sources: companies/just-auto estimates
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