LDV is recovering strongly from its collapse into administration with employee morale and market confidence picking up, the Birmingham vanmaker's American owner said yesterday.
The Washwood Heath company, which had debts of #234 million when it was rescued by an affiliate of Florida-based private equity group Sun Capital Partners in December, expects to take a ten per cent slice of the 100,000 heavy van-market in the UK this year.
The company is making a profit on a variable cost basis on each of the 200 vehicles it makes each week and overall profitability will be restored when production reaches 250 a week.
The year-old Maxus, now LDV's sole model, is piling on sales in 2006 after becoming the fastest-selling van in its market segment last year.
Its success was underscored yesterday by a Royal Mail order for 435 Maxus vehicles worth about #6.5 million.
Sales and marketing director Tony Lewis said up to October last year Maxus achieved a 12 per cent market share, putting it in third place behind Ford (34 per cent) and Mercedes (16 per cent).
In terms of post-launch sales growth, Maxus was second only to the Mercedes Sprinter, which entered the market in 1995.
"We are having a tremendous start to the year with our February sales of Maxus up 123 per cent on the corresponding period of last year," said Mr Lewis.
"Overall, we've increased sales by 26 per cent year to date and the all important month of March has started very well and I fully expect sales to be 70 per cent better than in the key selling month last year."
Mr Lewis was speaking at the first press briefing held since the company, now known as LDV Group Limited, was bought by Sun Europe, a London-based affiliate of Sun Capital, in December.
Sun Europe managing director Philip Dougal defended the decision to put the old LDV into temporary administration resulting in unsecured creditors not being paid, the firm's closed final salary scheme being put in the hands of the Pension Protection Fund and employee shareholders losing deferred dividends.
"When we were approached with a view to investing in LDV there was no plan for it to go into administration," Mr Dougal said.
"But when we began to dig into the situation it became clear that there was a significantly more difficult financial situation than we had at first appreciated.
"The old company had an underlying liquidity crisis and we felt that a pre-packaged administration was the only way to make this investment."
Interim chief executive Charles Megan, an American turnaround specialist with Sun Capital, admitted morale among the 600 remaining employees at the Drews Lane factory had been low following the collapse of the business.
But he said the mood had improved and market confidence in the company was being restored. "We averted LDV becoming another MG Rover. We saved the company from the brink."
