A £32M roads job wouldn’t normally make many waves, but for Colas and Volker Fitzpatrick their project to move and improve the A45 alongside a £33M lengthening of the runway at Birmingham Airport is highly significant.
As companies, Colas and Volker Fitzpatrick have many similarities. With turnovers of £253M and £400M and staff of 2,000 and 1,100 respectively they both fall into the medium sized firm category.
They are of a similar age, formed in 1923 and 1921 respectively, and they both operate as UK arms of European parents. As asphalt and concrete pavers respectively they are both specialists and market leaders in their fields; they are targeting the same markets in highways and airports; and they both carry out most of the work they win themselves.
“We have got non-conflicting aspirations and we are not scrapping over who does what.”
Given all that, perhaps it should not be a surprise that they have come to recognise each other as soul mates. Recognise it, they have. Use it, and yoke it, they intend to do, through a formal joint venture that has just reaped dividends with the award the £32M A45 transport corridor improvement scheme and the associated £33M runway extension at Birmingham Airport (see box). So it is no surprise that the men responsible for the £65M win - Colas operations director Carl Fergusson and Volker Fitzpatrick civils MD Des Steadman - were quite the happy couple when NCE met them at Colas’ West Sussex UK HQ.
“This joint venture is quite unique,” says Fergusson. “Our two companies bring different skills and we do our own building. We have got non-conflicting aspirations and we are not scrapping over who does what.”
“It’s a good fit,” he adds. “The values of the two organisations are similar so it is a good cultural fit,” agrees Steadman. “It is also a sector where we complement each other,” he adds.
The marriage was borne out of the aspiration of both firms to pick up work in the airports sector, a sector that demands many of the core skills used on highways jobs.
Both firms’ parents - Colas Group and Volker Wessels - have a long history of working on airport projects all over the world. But in recent times attention has shifted to the UK.
“We have a natural affinity for this type of work,” says Fegusson. “We made our name in this field on difficult places to get to.” The firm’s most high profile job has been the resurfacing of the airfield at Mount Pleasant Airport on the Falkland Islands in 2010 and 2011. But more recently - since 2005 - Colas UK took the decision to have a focused approach to the UK market. “Up to that point we were doing airports work on a regional basis,” says Fergusson.
“We are focusing our strategy on airports such as Glasgow and Heathrow but there are other airports to target.”
“Now we have a focused strategy on it.” This focus has seen the firm invest heavily in plant, specifically in the mobile batching plants needed to whip up the asphalt mix on site.
It is the same for Volker Fitzpatrick. “We have a long tradition in concrete paving works at airports. We do a lot of work on US airforce bases and a lot of work on provincial airports,” explains Steadman. Like Colas, Volker has a fleet of plant - pavers and mobile batching plants - that allows it to selfdeliver the concrete it needs for its jobs.
“We are focusing our strategy on airports such as Glasgow and Heathrow,” says Steadman, “but there are other airports to target.”
The courtship began in 2008 on Jersey Airport’s £19.5M runway resurfacing and strengthening project. Back then it was very much a traditional employer/employee relationship with Volker Fitzpatrick very much the boss. “Jersey was a traditional main contractor/ key supplier relationship,” notes Steadman. But Colas caught Volker’s eye by showing off some Gallic flair.
“One of Colas’ key strengths is research and development,” says Fegusson. “On Jersey we uniquely and successfully introduced French paving materials into the UK; it gave us technical advantage and a programme advantage.”
It meant the project was a resounding success and from there the relationship blossomed.
“From Jersey, the relationship developed and we did bid for Guernsey airport as a JV,” recounts Steadman. “The bid was unsuccessful, but it meant we were able to consolidate the relationship and from there we went on to bid - and win - Gatwick.”
There, the relationship is - on paper - once again a main contractor/key supplier relationship with Volker Fitzpatrick again in the lead. But the contract, which calls for the resurfacing of the world’s busiest single runway over 236 consecutive nights, again depends on Colas’ expertise in laying the 65,000t of asphalt needed.
“JVs are built up on personal relationships, a ‘my word is my bond’ kind of thing. But as the projects get bigger and more complex the JV is formalised”
To Fergusson and Steadman it is a JV in all but name, however. “We secured the runway project together as a stand-alone scheme,” notes Fergusson. Colas and Volker Fitzpatrick are two of 10 contractors to have secured a place on Gatwick Airport’s £1.2bn new major works framework, which will deliver improvements and upgrades across the airport over the next four years comprising building and civil engineering packages.
But the A45/Birmingham Airport job is a true JV - the sealing of the relationship in a binding agreement - and this is what makes it so special.
“You get access to two strong supply chains. So in a short tender period it helps you quickly get a wider pool of suppliers”
Fergusson is almost misty eyed as he recounts the approach. “JVs are built up on personal relationships, a ‘my word is my bond’ kind of thing,” he explains. “But as the projects get bigger and more complex the JV is formalised,” he says.
“Then when we bid together it is a seamless process. Our planners and programmers really get to know each other,” he says. There are other benefits too.
“You also get access to two strong supply chains feeding into the one bid,” says Fergusson. “So in a short tender period it helps you quickly get a wider pool of suppliers,” adds Steadman. “You also get double the resource for bidding and double the resource for delivery.”
On the ground it is also a case of one team not two companies. “The organigram for the team is populated by staff from Colas and Volker and there is no distinction between the road and airport parts of the project,” says Fergusson. “It is an equitable team.
On the horizon
Looking ahead, there are other jobs the firms are bidding for together. The JV is preferred contractor for Portsmouth City Council’s £20M project to build a new junction off the M275 motorway at Tipner.
It has also teamed up with URS to bid for Transport for London’s new term maintenance contracts.
“This wider collaboration might have started off in airfields but has now very much rolled out into highways,” says Fergusson.
And the sky is the limit in terms of future collaboration. Colas is eying up airports work internationally; Volker Fitzpatrick is already working in Canada; and Fergusson and Steadman see no reason why the partnership would not work abroad. “It is early days yet, but when it comes to looking at the resources needed to work overseas, you take your strongest team,” says Fergusson.
“We’ve already been doing work in Calgary, so if the opportunity was right we wouldn’t shy away,” adds Steadman.
A45 transport corridor improvement
Fitzpatrick and Colas have been named as joint venture contractors for two major Midlands construction projects.
They are the £32M A45 Transport Corridor Improvement Scheme and the £33M runway extension at Birmingham Airport, both of which were awarded after a competitive tender process run by Birmingham City Council. The JV has brought in Halcrow as designer.
The two projects are being developed together due to their close proximities and timeframes.
“Put simply we have got to move the A45 before we can build the runway extension - so the projects are intertwined,” explains Volker Fitzpatrick civils MD Des Steadman.
There are also obvious cost savings to be made from tying up two projects so closely located. These include increased purchasing power, combining utility diversion works, reducing construction overheads and minimising the need to export and import earthworks materials.
“As an example, just over 500,000m3 of earthworks will be excavated for the road with all but any contaminated material staying on site,” explains Steadman. “The best material won on site is to be placed as structural fill under the runway. The lesser material will be used as environmental bunds around the enlarged airfield perimeter.”
Work will begin on the A45 in July, and is expected to be complete by summer 2013. The estimated start date for the runway extension is June 2013, with an operational date of spring 2014, following full commissioning and flight testing. The A45 scheme may chiefly be about diverting the dual carriageway to allow for the runway extension, but it will also regenerate the link, cutting congestion. A dedicated bus lane to the airport will be built as part of the scheme.
Meanwhile, the 405m runway extension will enhance the airport’s capability, allowing it to receive aircraft types flying directly to long-haul destinations. These require a longer take-off distance than the current 2.6km runway allows. “At £65M it is not a massive construction job, but we recognise the strategic importance of this project to the region,” says Steadman.