As pre-tax profits and impairments rise, Hitachi Capital
is said to be looking to axe 20 members of staff
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Following the news that it would be
severing the majority of its links with asset finance brokers, it
has now emerged Hitachi Capital has initiated a consultation period
for employees at its Business Finance division, based at the
company’s HQ in Hounslow.
Last month, it was also announced that Robert
Munn, the division’s MD, would be leaving the business in early
December. It is understood Munn, who has been at Hitachi Capital
since 2002, is being made redundant.
The fact that Hitachi Capital has initiated a
consultation would indicate 20 or more employees could be affected
by the cuts.
“It is a very unhappy environment,” said a
Hitachi Capital employee. “We were sent a memo explaining that
after reviewing the situation, the business finance MD’s position
was no longer needed, and that Munn was being made redundant.”
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By GlobalDataThere is even speculation the business, which
is still under review by Hitachi Capital’s board, could be
downsized “until things are a bit more settled”.
Returning a £6.7 million (€7.4 million)
pre-tax loss last year, the Business Finance division is the worst
performing of Hitachi Capital’s three main business lines – the
other two being Vehicle Solutions and Consumer Finance, which are
both profitable.
Over the last year, as a direct result of the
increase in UK company failures, Munn’s division has been hit hard
by bad debt and write-offs. In the 12 months to April 2009, bad
debt charges rose from £15,000 to £11 million.
But John Atkinson, group head of marketing at
Hitachi Capital, strongly refuted claims that the business finance
division could be shut down entirely.
“This is not the case – the business is under
review, but we are looking at the broker team, and the intention is
to replace it with direct channels,” he said.
When it was revealed Hitachi Capital would be
cutting its broker links, Munn told Leasing Life: “We have found
our direct business to be more profitable, less risky and more
sustainable, and as such we have made the decision to cut broker
business in general asset finance and professions finance.”
Commenting on Munn’s departure, group chief
executive David Anthony said: “I would like to thank Robert for his
contribution and commitment to Hitachi Capital Business Finance
over the past seven years.”
