Meeting GKN: the British automotive firm leading the world

Unlike other EV specialist companies whose progress is often geared to the uncertainties of battery progress, GKN’s driveshaft-plus-edrive business promises relatively hassle-free expansion, as long as it can continue to handle the need for rapid change. In 2019, around 90% of GKN’s products went into internal combustion vehicles, but by 2025 the company forecasts that the ICE proportion will have halved, with mild hybrids making up 29% of its market, full hybrids accounting for 11% and battery EVs taking 15%.

Meanwhile, the global car market continues expanding as emerging markets accelerate: GKN believes 102 million cars will be made in 2030, compared with 89 million in 2019.

Oddly, the GKN name was better known half a century ago than it is now. A company that began life in 1759 with the founding of a Welsh ironworks, it became Guest, Keen and Nettlefold (GKN) at the beginning of the last century, then came to prominence in the car world around 1950 as a supplier of components for the game-changing Jaguar XK120 and its Le Mans-winning siblings. In the 1960s, GKN won plaudits for developing and supplying constant velocity (CV) joints for Minis and the many transverse front-drive models that followed.

In recent times, GKN was a somewhat fusty industrial group divided into several divisions, until in 2017 it was acquired and completely reorganised by the venture capital group Melrose. Butterworth, who had been running the US-based Delphi business (a specialist in fuel systems for internal combustion engines), was hired to carry out a root-and-branch reorganisation of the most promising parts of the business, newly titled GKN Automotive.

Butterworth is an engineer by training who began his career as a shop-floor apprentice, working in the old Burnley-based Lucas electric components business while acquiring his qualifications. He sees starting at the bottom as a key aid to modern management: “It helps you relate to the people in our plants; to understand what they need to know about our business.”

While he was eyeing the opportunity to join GKN from Delphi, Butterworth says he was impressed by how “bulletproof” the new business was as the automotive world moved towards electrification. “We had a core business based on anything that turned a vehicle’s wheels, which wasn’t going to die,” he says. “But then there was this rapidly expanding e-drive opportunity: the question was how to reorganise and invest to take best advantage of a huge opportunity.”

The scale of the potential business is clear from the greater value of EV components in a new car compared with driveline parts in an old one: GKN’s parts in a typical ICE 4x4 might have run to £1200 before 2019, but the value of its contribution to a new BEV 4x4 is likely to be closer to £3000. Apply such thoughts to 50% of the world’s cars and you’re looking at a remarkable opportunity.

Many European component giants have suffered at the hands of lower-cost, faster-acting Chinese rivals, but Butterworth believes GKN can maintain its record of supplying components for 50% of the world’s cars to 90% of the world’s car makers.