Finance deal clears road for caravan firm

The Swift Group, which is based in Cottingham, near Hull, has increased its staff numbers from 800 to 900 over the last year. The company also expects its full-year turnover to rise from 150m to 200m as the economy starts to emerge from recession.

Richard White, the Swift Group's marketing director, said consumers could bring forward their purchase of "big ticket" items such as caravans because of the forthcoming rise in VAT.

In last week's Budget, Chancellor George Osborne revealed that VAT would rise from 17.5 per cent to 20 per cent next year, in a move which will bring in 12bn a year for the Treasury, but also means the typical household will pay 400 extra a year.

Mr White said current trading was "very strong", adding: "In a fairly static market we have increased market share."

In late 2008, Swift made about 280 workers redundant after caravan sales fell dramatically. At its peak, the company employed about 1,000 staff. However, trading conditions have improved as confidence returns to the market and more people choose to take holidays at home.

Yesterday, it was revealed that GE Capital had agreed to provide Swift Group with a finance facility that will provide the company with an estimated 30m of dealer stocking funds in 2010.

In a statement, GE Capital said the deal would generate "tangible benefits" for both Swift and its UK dealer network.

The Swift Group will benefit from guaranteed payment for shipped caravans and motorhomes, which will allow it to focus on designing, manufacturing and selling its products.

The extended terms provided by the GE Capital programme provides dealers in the Swift network with the flexibility to display products until they are sold.

The facility is expected to finance volumes approaching 30m in 2010. Volumes are predicted to exceed 60m in 2011.

Maarten Endel, industry leader for recreational vehicles at GE Capital, said yesterday: "This financing arrangement will support Swift by providing the company with access to funds the moment a new caravan or motorhome leaves the production line. Working capital is really important to companies and not having to wait until their products are sold to end users before accessing funds will help Swift finance further production as the economy recovers.

"We will also be providing finance to Swift's dealers. It allows dealers to hold more stock."

This will reduce waiting times for customers and allow dealers to showcase more models, Mr Endel added.

GE Capital already works with more than 50,000 small and medium-sized enterprises in Britain.

Mr Endel added: "Swift is a successful, privately owned mid-market company that we are very pleased to be able to support. We work with a

large number of UK manufacturers such as Triumph, Jaguar Land Rover and Sunseeker to provide similar distribution finance arrangements.

Nick Page, commercial director of Swift Group, said: "Providing adequate stock funding to our dealer networks is a vital cog in the retail chain, enabling dealers to display and sell more of our products.

"GE's support for Swift and the UK market is great news and will help the industry move out of recession more quickly."

Major player in holiday vehicles

Hull-based caravan manufacturer The Swift Group is owned by Peter Smith, who took control of the company in 1972 after his father Ken died from a heart attack.

He has built up the business to become

the UK's largest caravan manufacturer and the third biggest in Europe.

Swift is also the only company in Europe to manufacture touring caravans, motor homes and holiday homes.

Sales fell during the recession, and the company was forced to make redundancies.

It is forecasting a return to sales of 200m this year.