Revived Doncasters trolls for acquisitions
The completion two months ago of Dubai International Capital’s £700 million ($1.3 billion) takeover of Doncasters has brought stability and fresh opportunity to the UK engineering group. Chief executive Eric Lewis has confirmed that the firm will now target acquisition opportunities in North America and Asia. And it also views the Middle East as a prospective manufacturing site, with its new owners being part of the Dubai Aerospace Initiative launched in February to develop the ambitious emirate as the world’s latest aerospace hub.
Doncasters has been sold by one venture capitalist, the Royal Bank of Scotland Equity Finance, to another. “Of course we were bought to be sold, but it [Dubai International Capital] definitely wants to improve shareholder value and so it will take a three- to five-year view rather than looking only to the next quarter’s results as is the case when you are a public company,” Lewis told Aviation International News.
In recent years, Doncasters (Hall 4 Stand G10) has been extending its position in aerospace by winning supply chain management responsibilities to make it more than just a fabricator. The group specializes in aero engine components including the following: casings, forged fan and compressor blades, exhausts, hot-end cast turbine airfoils, intake lip skin and erosion shields, cover panels, bleed-air ducting, rings and seals. It also makes some fuselage panels.
In its desire to reduce the number of vendors they deal with and the parts inventory they have to hold, OEMs are turning to groups like Doncasters to manage parts of the supply chain by taking full responsibility for packing together subsystems. Lewis said he is currently working on a proposal for an OEM that could save it some $40 million in parts and materials inventory, while also reducing by 40 percent the amount of time it takes to get the products concerned to market.
One existing example of Doncasters’ supply chain management role is its deal with Hamilton Sundstrand to harness 40 components for the auxiliary power unit that the U.S. firm is developing for Boeing’s 787 airliner. Lewis hopes to get further work from the program fabricating entire subassemblies for other power systems on the aircraft. It already contributes parts for the Rolls-Royce Trent 1000 engines that will power the 787.
The 787 APU project also demonstrates the rising trend for concurrent engineering between fabricators and tier-one manufacturers. As soon as the two companies started working together, Doncasters placed five of its design engineers at its partner’s San Diego, California facility to work side-by-side with the engineers there. This should reduce the lead time to market for the APU, since engineering issues ought to get resolved more swiftly than would be possible with the eight-hour time difference.
The move into supply chain management has not come cheap. Doncasters has increased its head-count of engineers by as much as 40 percent to ensure that it is up to the task, and it has also made significant investments in new equipment.
It has made a big push to accelerate production with more flexible and automated machines that can make engine-ready components more efficiently. According to Lewis, the use of high-speed machines can eliminate the cost advantage that would otherwise tip fabrication tasks like this away from Europe and North America and into the lower-cost economies of the East.
Doncasters’ technological edge is in working with a variety of alloys and metals that are difficult to shape. Last October it spent close to $12 million to open an engineering center of excellence at Blaenavon in south Wales, where around 100 people are employed developing and producing precision components for aerospace. It is advancing techniques such as centri-spun castings which use g-force to get the shapes required.
Other clients of Doncasters include General Electric, Pratt & Whitney, Honeywell, MTU and Snecma.