Allied Vehicles, the Glasgow taxi-maker, provided further evidence that the credit crunch is impacting the real economy by saying that the scarcity of loan funding was hitting sales.
Allied Vehicles, the Glasgow taxi-maker, provided further evidence that the credit crunch is impacting the real economy by saying that the scarcity of loan funding was hitting sales.
In the company's latest accounts, Allied says the difficulties its customers face in obtaining loans have tarted to impact upon the trade, following a period in which the firm has achieved dramatic growth.
The accounts for the 15-month period to April 30 show that Allied grew turn-over to £69m from £44.1m in the year to April 2007. In addition to selling taxis, the company claims to be the largest supplier of wheelchair- accessible vehicles in the UK. It produces vehicles adapted from chassis provided by Peugeot and Fiat.
On an annualised basis, total sales increased by 25%. The strong growth may have reflected the fact that credit remained relatively freely available until the credit crunch deepened last winter.
While the market for wheelchair-accessible vehicles should be supported by strong public sector spending, any benefit may have been offset by worsening conditions in the commercial market.
In their report, dated October 7, directors wrote: "At the time of writing many industries are experiencing difficult market conditions. Avail- ability of finance for our customers is an issue and is having an effect on sales in the UK vehicle market."
Yesterday, car retailer Inchcape said there had been a sharp downturn in the UK market.
Nonetheless, Allied directors appear confident that the specialised capacity developed by the company in its 14 years of existence should help it to continue growing.
"The company intends to continue to increase vehicle manufacture in the next few years, both by expanding penetration of core markets and by developing its skills in the conversion of environmentally-friendly electric vans and minibuses."
Allied is preparing to start selling the UK's first battery-powered taxi.
The company recently expanded its manufacturing facilities in Possilpark. With an average 333 employees in the latest period, up from 301, the firm is a significant employer in the area.
Allied was established as a motor dealer in 1994 by former mechanic Geraldo Facenna and his brother Michael, who share ownership of the firm. Its diversification into taxi production saw the company bring large-scale vehicle production to Scotland for the first time since the Talbot factory at Linwood, Renfrewshire, closed in 1981.
In the latest period, operating profit increased by 19% to £651,469.
The total directors' pay bill fell to £387,484, from £457,854. The highest-paid director earned £141,573, down from £184,339.The company did not pay a dividend.
None of the directors was available to comment.
