Friday, 14 May 2010
Spare parts for a motor racing vehicle
Since it was founded in 1984, Xtrac has earned a reputation for making high quality gears and supplying gearboxes for racing events all around the world. The company continues to go from strength to strength and now employs 270 people.
A recipient of the Queens Award for Export, Xtrac’s biggest market is Europe, followed closely by North America.
“We have always taken a global view, and 70 per cent of our business comes from outside the UK,” says Peter Digby, Managing Director of Xtrac Limited. “We have found trade missions to be invaluable in helping us to research new markets. The support of the Motorsports Industry Association and financial backing of organisations like UK Trade & Investment helps us to manage language or logistical factors that would be harder for us to overcome alone.”
Over the years, Xtrac has been on trade missions to Italy, France, Japan, and America, meeting potential new customers and picking up business along the way. And they’ve found that satisfied customers help them to generate new business.
“Despite being spread all over the world, the motorsport community is relatively small,” says Digby. “There’s a lot of cross-over between teams and engineers at different events, and when a customer is happy with our product they tend to spread the word.”
A lot of Xtrac’s new business comes from contracts with event organisers, who increasingly specify to racing teams that they must use a certain type of car, with a certain make of gearbox.
One of the company’s largest clients is the Indy Racing League, which runs the world’s biggest motor race, the Indianapolis 500. In fact, this contract keeps Xtrac so busy that in 2003 the company opened its first overseas office, in America.
“When we make a deal with a race organiser, it’s really a winwin situation,” says Digby. “We get a great volume of orders and the certainty of an ongoing contract. We are then able to pass on the cost benefits of this to the teams, keeping prices low. And spectators benefit too, because they know when they watch a race that the cars are reliable, and that the competition is really all about the skill of the drivers.”
Helping you do business abroad
Doing business in another country can be a challenge, so it's good to know that UK Trade & Investment is there to help you succeed.
Through a range of unique services, including participation at selected trade fairs, overseas missions and providing bespoke market intelligence, UK Trade & Investment can help you crack foreign markets and quickly get to grips with regulations and business practices overseas.
Through our Passport to Export programme we offer new and inexperienced exporters:
free capability assessments
support in visiting potential markets
mentoring from a local export professional
free action plans
customised and subsidised training
ongoing support once you're up and running
Every year, Xtrac exhibits at various international racing car shows to explore new business opportunities with buyers from all over the world.
The largest of these in Europe is Autosport International, held annually at the NEC in Birmingham. For several years, the show has been supported by UK Trade & Investment, which sponsors overseas companies to fly to the UK to meet the best UK companies in the industry.
“Motorsport shows are amazingly useful for us to pick up new overseas customers,” says Digby. “They have become increasingly important in the last few years, and Autosport International is one of those exhibitions that every company in the UK motorsport industry wants to attend.”
From Germany to Brazil
In November 2007, Xtrac flew to Cologne, Germany, for the Professional Motorsport World Expo. There they met Brazilian company JL Racing, at a Meet the Buyers event organised by UK Trade & Investment. JL Racing was looking for a gearbox supplier for the 2009 Nextel Cup Stock Car season. They had already heard of Xtrac, and were impressed by the company’s reputation.
Negotiations got under way and, when the two companies met again at the Performance Racing Industry trade show in Orlando the following month, they finalised the deal for Xtrac to supply 40 gearboxes.
“We had been looking to expand our business into South America,” says Digby. “Because of our huge manufacturing capabilities, it is now possible for us to pursue smaller markets as well as supporting the Formula One business. We’re hopeful that meeting JL Racing in Cologne and concluding a deal with them is just the start of our business interest in Brazil.”
The UK and Brazil
Brazil is the UK's most important trading partner in Latin America. UK exports of goods & services were valued at US $1.9billion in 2007, with bilateral trade between Brazil and the UK increasing by 23.8 per cent (a total of US $5.2billion) compared to 2006.
The UK is one of Brazil's largest foreign investors, and many large UK corporations have well-established operations there. UK Trade & Investment has identified Brazil as a High Growth Market, with a broad and sophisticated industrial base.
The Brazilian Government continues its programme of privatisation and deregulation, and there’s a growing middle class with real spending power.