Loughborough's Brush Transformers to open Chinese factory

A well-known engineering firm is to set up a £1m factory in China as part of a bid to boost overseas sales.

Brush Transformers, of Loughborough, says the Beijing plant, which will supply electrical transformers to the country's mining industry, should open early next year.

It comes after the company has been hit by a lack of major new projects in the UK, where it makes two-thirds of its turnover. This caused growth to stall in 2009, which is set to continue this year.

In an effort to broaden its market, the company recently began making giant transformers after a £1m investment at its site in Falcon Works, off Nottingham Road. It previously only supplied in the mid-range market.

A spokesman said: "Approval has been granted for a £1m project to establish a manufacturing operation in Beijing to supply the local mining industry. It is expected that the factory will be operational in early 2011."

The announcement follows a visit by Chinese Ambassador Fu Ying in June last year, during which she praised the company, which employs about 250 people in the town. The Chinese factory will employ about 100 people.

The firm yesterday said it made a "significantly higher" profit last year compared to 2008, despite similar sales figures of about £40m.

Supplying transformers which boost electricity supply across the National Grid, the business works with all the major electricity providers. It also supplies the oil and gas sector in the Middle East and operates a joint manufacturing venture in Abu Dhabi.

Speaking in June, David Woolhouse, Brush Transformers' managing director, said an investment in new equipment would allow it to make 132-volt machines. It mostly makes 33-volt ones. He said this would help boost turnover by 50% to £60m over the next five years.

The Brush group, which includes Brush Turbogenerators and Brush Traction, employs 1,200 people in Loughborough. It is owned by Melrose, which yesterday reported its annual financial results.

Brush Turbogenerators, the world's largest independent manufacturer of electricity generating equipment for industrial, marine, oil and gas and offshore markets, has a £225m order book, well over 50% of its budgeted sales for 2010.

Brush Traction, which refurbishes railway locomotives, saw a decline in workloads after the ending of a major train contract. However, bosses said it had a "satisfactory" 12 months.