Annual Review The go-to place 2016-2017 for advanced manufacturing technologies in the UK As the UK pursues an ambitious industrial strategy and navigates the uncertainty of Brexit, HVM Catapult’s expertise plays an important role in anchoring high-value manufacturing activity in the UK. Terry Scuoler Chief Executive Officer EEF, The Manufacturers’ Organisation 2 Contents Chairman’s statement 4 Chief Executive’s statement 6 Performance highlights 8 Success stories 10 Strategic influence 20 Electrification 22 Digital manufacturing 24 Affordable composites 28 Construction 30 Skills 32 Regional outreach 36 Our centres AFRC: Advanced Forming Research Centre AMRC: Advanced Manufacturing Research Centre CPI: Centre for Process Innovation MTC: Manufacturing Technology Centre NCC: National Composites Centre Nuclear AMRC: Nuclear Advanced Manufacturing Research Centre WMG: WMG Catapult 3 Chairman’s statement HVM Catapult will maintain its resolve to work with industry, academia and government to help make the UK an even more attractive place to invest and do business. Many of us will remember 2016 as a year of This resilience and clear constancy of purpose extraordinary events. The UK became the first was reflected in the work of the High Value country ever to vote to leave the European Manufacturing Catapult (HVM Catapult) last year. Union, starting a period of uncertainty and Once again, we have seen customer numbers unprecedented and complex negotiations and grow, and we have been instrumental in a number agreements. The US elected a new president, of high profile examples of overseas investment whose fiscal and monetary policies and in new high value manufacturing capability in potential protectionist measures will have the UK. Companies such as the iconic McLaren effects on the UK economy which are, as yet, Automotive and American aerospace giant hard to predict. Boeing, for example, announced significant investment and job creation in this country on The scale and nature of these changes in the the back of the longstanding commitment and UK and the world over the past 12 months has leading technology from our centres. gone beyond what many people expected. Bob Gilbert CBE Although industry, in general, was in favour of It is encouraging to note that we continue to Chairman the UK remaining in the EU, our manufacturers see many small and medium-sized businesses High Value Manufacturing Catapult were among the first to realise the need to adapt come through our doors, both in real terms and to the new reality and to ‘get on with it’. British as a proportion of our overall customer base. pragmatism at its best. We are committed to ensuring that the benefits of working with us are fully exploited by small A recent EEF survey showed that over 50% and medium sized enterprises (SMEs), not least of companies surveyed expected to increase because they play a critical role in safeguarding investment in technology and innovation in and creating jobs in this country. 2017 and 56% of respondents reported that they will undertake process innovations to increase On a similar note, we continue to broaden the productivity. Industry’s undeterred resolve and range of sectors we work with, recognising focus to deliver long-term growth can be seen that the value of our services are not restricted as an extraordinary event in its own right. to the advanced technology sectors such as aerospace and automotive. Much of what we It should therefore not be a surprise that the do can deliver game-changing improvements in pessimistic forecasts on manufacturing output other industries such as food and drink, medical and overall economic performance have not technologies and construction. In construction become a reality. Supported to some extent in particular, this year has seen us make real by a weak Sterling boosting export figures, headway in transferring manufacturing process performance in UK manufacturing was strong and technology know-how from aerospace and throughout 2016, with the UK economy automotive to this industry, which has much being the fastest growing of the G7’s leading to gain from exploiting new and emerging industrial countries. manufacturing technologies. The progress that we are making could not be achieved without the considerable input from my board colleagues, the efforts of our core team, and the increasing collaboration between all of our seven centres and I wish to thank everybody involved for their continued dedication and enthusiasm. 4 5 Chief Executive’s statement This year saw the HVM Catapult reach its 5th anniversary and this has led me to reflect on what has been achieved since we started in 2011. In 2011 our seven centres had a collective Proven track record Dick Elsy asset base of buildings and equipment Our performance figures demonstrate the Chief Executive totalling £255m. We now have £617m in play, continued appetite for our support and services. High Value Manufacturing Catapult supporting industry to bring new manufacturing technologies to market. It has been a Through the year, we have worked on more remarkable growth story driven by industry than 1,700 projects with over 3,300 industrial demand, a demand that had remained pent up clients to develop and deploy innovation in until the Catapult was set up to fix the market manufacturing. Our commercial and our failure: the fact the UK is great at scientific collaborative research and development research but consistently fails to exploit it as (R&D) income has increased by 8% and 17% manufacturing value-add. respectively on last year. This is set to continue to rise into next year as our confirmed order This has defined our mission over the book for 2017-18 currently sits at £205m. last five years and sets the scene for the next five years. We are uniquely positioned One of our most encouraging statistics for to understand the needs and challenges of the year is the number of apprentices that we advanced manufacturing companies and support in training. Although skills development convey this at a national level to government was never part of our original brief when we were in policy development. founded, the determination of our centres to champion this, has led to over 860 young people We continue to support ground-breaking in apprentice training in our centres in the past innovation in the way we design, make, and year alone. use products, based on major technological advances in areas such as materials, A winning formula processes, robotics, virtual and augmented We have stayed true to the established principle reality, additive manufacturing, artificial that the HVM Catapult should receive broadly intelligence and data analytics. equal amounts of funding from Government, public and private co-financed collaborative We have a government which has put industrial R&D projects, and commercially funded R&D strategy at its core, understanding the contracts. We believe that this model continues importance of a rich seam of manufacturing to serve as a simple yet remarkably effective value-add in the economy. Through the driver of our efforts to take risks and develop Industrial Strategy Green Paper, government new technologies and processes in those areas calls for the right institutional arrangements to that are most relevant to industry but which be put in place to support this. I contend that it cannot be achieved without coordination, need look no further than the HVM Catapult as collaboration and expert support. one of its key delivery mechanisms. 6 Impact Evaluation Forward View We have previously reported on our economic Last year we made no apologies for calling impact, through a study we had commissioned, for “more of the same”. We have proven which showed that we yielded a 15:1 benefit that we have the right model to support UK of economic value for every pound of core industry. This is validated by the sheer volume government funding invested. This year we of business in both commercial work and have submitted ourselves to an extremely collaborative R&D. If our offer was not relevant comprehensive and fully independent to industry we would not win its business, and evaluation, looking at circa 140 organisations in the case of collaborative R&D, the proof which ranged from between 1 and 1,500 is that we win competitive bids as a proven employees. This study, commissioned by collaborative partner. In 2016-17 this accounted Innovate UK, is due to report this summer. We for £67.3m of our income. are confident that it will show continued and significant impact. Given experience, we also We are therefore confident in continuing with expect it to show the importance of constancy our strategy to: of purpose, and that much of the economic — Stimulate and de-risk investment in impact results from sustained efforts to develop innovation while accelerating growth and technology, both internally within the centres anchoring high value development activity and externally with our customers. in the UK — Deliver step changes in productivity and Renewed focus as the go-to place for competitiveness and solve big problems advanced manufacturing technologies for whole value chains In addition to our ongoing and growing work — Enable the UK to move towards more with our industry customers, we have stepped digitally connected factories and supply up our investment and efforts in addressing chains key issues of national concern, such as the — Support more companies and more SMEs development and exploitation of vehicle and broaden our regional presence. electrification and battery technology, affordable composites, digital manufacturing as well as With the emergence of a UK Industrial technology applications in the construction Strategy we clearly have a government which industry. These represent opportunities which understands the importance of industry and require a coordinated response from industry, the backbone it provides for the UK economy.