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D&M does deal to sell Siemens motors

01 December, 2004

D&M does deal to sell Siemens motors

Siemens has formed a partnership with Dowding & Mills, under which D&M will supply, commission, modify and repair Siemens low and medium voltage motors in the UK. For Siemens, the deal will provide a new channel to the end-user market; for D&M, it will offer an alternative to repairing motors, especially at the lower end of the market where rising labour costs and cheap motor prices are making repairs harder to justify.

The partnership follows several years of changes at Dowding & Mills, the UK`s largest independent supplier of electrical and mechanical engineering services. In 2001, there was management buy-in at the company, followed by a strategic review of its activities "to bring stability and clarity," according to the company`s commercial director, Graham Hartley.

As a result of the review, several of D&M`s under-performing activities were closed or revamped. The company sold off its European operations and two gear businesses in the UK.

According to Hartley, "a significant number of people and layers" have been taken out of Dowding and Mills` remaining operations. Previously, he reports, there were too many layers of management and "the sales team were extremely confused about who they were working for, and what they were meant to be doing".

The slimmed-down D&M now focuses on three activities: engineering services, with 23 UK branches; calibration services, with five UK sites; and electronics, with four sites.

The new deal with Siemens reflects the changes in the motors market in recent years, which has seen prices dropping, especially for small LV motors. It has become harder to justify repairing small, standard motors especially, as Hartley points out, "labour costs are not getting lower".

"The bottom end of our market is being squeezed," he adds. There are no hard-and-fast rules, but the breakeven point between repairing or replacing a motor is now around the 22kW mark.

D&M therefore looked around for a "credible" motor supply partner. "Siemens A&D is the largest motor manufacturer in the world, and we are the largest independent repairer in the UK, so it was logical step for us to bring our strengths together," says Hartley.

He emphasizes that D&M will continue to repair larger and non-standard motors, such as imperial models. "We have to keep the skills to repair special motors," he says.

For Bob Owen, general manager of Siemens A&D`s large drives and rotating machines business in the UK, the agreement will provide an opportunity to penetrate the end-user market and boost Siemens` share of the UK LV motors market which, he admits, "has languished for some time".

The deal between Siemens and D&M will be extended this year to include variable speed drives, focusing on retrofit applications.

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