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Trading on pedigree

Kvaerner Cleveland Bridge has been at the forefront of major bridge building over 120 years, absorbing on route several name changes and other steelwork giants like Dorman Long and Redpath Engineering. Founded as Cleveland Bridge and Engineering by Henry Dixon in 1877 close to its present Darlington site, the company faced successive takeovers by Cementation, Trafalgar House and, in 1966, by is present owner Kvaerner. Now part of Kvaerner Construction, the firm can claim a major involvement in four of the world's 10 longest suspension bridges and is currently building China's Jiangyin bridge destined to become number four in the league table.

Good morning, Kvaerner, says the telephonist sitting in the reception area of a Darlington steelwork contractor.

Yet visitors milling around her in the foyer - and countless engineers worldwide - know the firm not by this parent label but by the second half of the company name - Cleveland Bridge.

Few would disagree that the unimposing reception area was the entrance to one of the world's most famous builders of steel bridges. And stepping back a few metres to the entrance door, the list of registered offices would remind visitors of the two now integrated steelwork legends - Dorman Long and Redpath Engineering - that collectively dominate the name plaques on most of this century's major bridges.

But it needs more than a track record of quality to succeed in today's cut-throat steel construction market - and Kvaerner Cleveland Bridge faces changes. It is a self-imposed operation injected with both pain and risk.

The current picture appears bleak. Negative profit last year on a £98M turnover; depressingly empty fabrication bays on the vast factory floor and imminent closure of the company's

in-house apprentice training school - a bastion of learning for generations of loyal North East steel families.

This all too apparent downside was crowned just a fortnight ago with the shock announcement of 98 more redundancies on top of the 80 'let go' last September.

Yet shop floor concern is more than countered by boardroom determination that the pain will bring only gain as the company regroups to compete in next century's marketplace.

'We have the strength and ability to do much more,' says managing director Ramsay Ross. 'Regrettably the redundancies are necessary to reduce overheads and make our operation more efficient, but now we will have a 100% skilled team to fight a wider market worldwide.'

Large, long span bridges are, and will remain, the company's core product. But it is now vigorously attacking everything steel, in structures ranging from complex foundations and high rise offices to power stations and petrochemical works.

It is even bidding for concrete bridges, notably cable stayed, replacing its more recent image as a steelwork subbie by returning to the role of main contractor offering the full monty.

This aggressive marketing coincides with what many regard as a release from the shackles of 26 years ownership by a multi-disciplinary group that, certainly in its latter years, failed to appreciate the firm's potential. After the takeover by Trafalgar House in 1970, the famous company name was eventually erased from factory walls and replaced by a new title, Cleveland Structural Engineering .

'Meaningless and stupid' are two of the more polite adjectives Ross attributed to this name change. 'Cleveland Bridge is a brand name for major bridges, even to the layman,' he asserts.

But Trafalgar House brought more than just a new name. 'It changed the whole nature or our business, reducing us to a role of subcontractor in a market driven by quantity surveyors,' Ross recalls. 'Our company has long been driven by engineering culture but Trafalgar House concentrated on short term gain with little thought to the longer term.'

Such remarks have added poignancy, for they come from a managing director who is not a civil engineer but an accountant. And, in the two years since Ross was handed the reins at Darlington, his resistance to pursuing the bottom line regardless of this 'culture', has won him the confidence of a highly specialised engineering staff.

Ross also found an ally in the company's new owner, the Norwegian-based multi-national Kvaerner, that took over Trafalgar House three years ago. Within months the Cleveland Bridge signboards were back on office and factory walls and, says Ross, there was a sea change in attitude.

'The company was listened to again,' he recalls proudly, citing a small change that epitomised the new mutual respect. 'Kvaerner directors took the trouble to come north to us and board meetings were held in Darlington rather than London.'

Confidence rose, the contractor started to trade under its own name rather than that of its parent, and the self-imposed refocusing, now under way, was actively encouraged at Kvaerner head office.

The world bridge building market is even more cyclical than construction generally and the 300-strong Darlington labourforce is used to temporary layoffs. Prestige projects, like Hong Kong's Tsing Ma crossing and, until last summer, fabrication of deck boxes for the latest contract - China's £100M Jiangyin suspension bridge across the Yangtze river - take up most of the factory floor.

But when, as now, only relatively small contracts follow - box strengthening for Avonmouth bridge and retrofit steelwork for Plymouth's Tamar crossing - fabrication bays quickly empty.

However this month's 98 redundancies are very different and, says Ross resignedly; 'these people will unfortunately not be back'. The 70 or so going from the shop floor and are all non or semi-skilled workers, and the 28 staff leaving are not seen as crucial to the company's core markets.

For nearly a century, Cleveland Bridge has trained up countless shop floor workers, with over £650,000 committed annually to its apprentice training school. But no more.

'None of our competitors do any training and, in the present climate, it is simply not economic for us to continue,' says Ross. 'Neither government nor clients recognise such commitment to training.'

Offering a totally skilled workforce, Cleveland is actually recruiting engineers to boost its specialist design service in both steel and concrete. Over £300,000 has been invested in computer aided design and half the factory will now be geared towards sectional steel for buildings, rather than plate for bridges.

The company's main contractor roles, notably in the A1/M1 link near Leeds and Birmingham's northern relief road, leave Ross confident that the downturn is shortlived. He predicts a 'small' profit this year on reduced turnover of £86M.

The company's long term success may, however, lie overseas, where parallel restructuring of Cleveland's several bases is geared to attacking a varied but selective market.

Offices in Dubai, Malaysia and South Africa are all now co-ordinated by three engineers and a secretary based strategically in Hong Kong. The aim is to focus on a growth area, currently petrochemical plants in the Gulf, and source steel and manpower from the most economic of all four centres, including Darlington.

Thus the now depressed Malaysian base is backing up the Dubai office where a new 40,000t capacity fabrication yard is being built. Similarly, says Ross, the Darlington office, with its concentration on complex design and fabrication work, should benefit from integration.

But the really rich pickings may well come out of China, where the company's Jiangyin suspension bridge has provided a valuable foothold.

Cleveland Bridge is now setting up a permanent joint venture with a local partner and Ross is optimistic that the company can at least bite into a market reputedly offering at least 50 long span bridges over the next five years.

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