Thames builds bridges to an uncertain future

By Rod Oram

The political will is there, but this once-prosperous town still has to decide which route to take
Thames is New Zealand writ small. Once a prosperous town, it's wrestling now with what sort of place it wants to be and, thus, how it will learn its living.

The crunch came last October when the last Toyota rolled off the Thames assembly line, ending 34 years of local production. The loss of several hundred jobs was serious but not a death blow. Thanks to other local manufacturers and employers, Thames still has a viable, if weakened, economy.

Toyota is playing its part too, by reinventing its local operations. Where once 330 people assembled about 40 new cars a day, 50 people work on imports - refurbishing about 16 secondhand cars a day and preparing about 34 new ones.

But the trends seem hostile. Toyota was only the latest local company to cease manufacture. Growth industries, particularly tourism, are largely by-passing the town.

Local leaders know Thames is better off than many other towns but they also know from their so far fruitless search for a replacement to Toyota that they have their work cut out to put Thames back on a strong growth path.

"A lot of small communities have been battered to death," says Mayor Chris Lux. New to politics, he sees his election last year as a mandate to reinvigorate local government. His drive is shared by Steve Ruru, the new chief executive of Thames Coromandel District Council.

"The council has a leadership role to play in economic development," says Ruru. "It if doesn't, nobody else will. We've decided its part of our core business."

The first big push for new investment came last year with a marketing blitz by the council to try to find a new user of the Toyota plant. However, hundreds of letters, video presentations on CD-ROM disks and dozens of visits yielded no takers. Meanwhile the council embarked on a broad study of the district's economic potential.

As the Toyota plant wound down, a resource centre was set up to help employees find new jobs. When the closure was announced in October, 1997, 330 people assembled cars. When the assembly line stopped, employment had dropped to 180.

Today, 50 of them are working in the revamped Toyota operation which started up this February. "We're hoping with our five-year plan to double output and staff," says Chris Leavy, the plant manager.

But despite the import operations, at least 130 were left jobless, although the total might have been closer to 250 considering the drop in Toyota employment since 1997.

Some have been absorbed by other local companies; some have drifted away. Between 30 and 40 are believed to be still actively looking for work in the town.

Frustrated by the slow progress, local businesspeople took a new tack. Led by Graham Muir, managing director of Thames Industrial Laundry, they worked to establish Thames Business Enterprise as a council body to push economic development.

Thames Business Enterprise, set up last July, secured enough funding to run until about March next year. Of the $240,000, $60,000 came from the Thames Community Board, $30,000 from local businesses and $150,000 from central government.

"We've had to go through a huge growth curve," says John Robinson, TBE's sole full-time employee. "From an initial marketing role, we've got into mainstream economic development. Most people have had a degree of discomfort about but they understand why we have to do it."

With the help of Brian Begley, a former Irish economic development consultant, TBE studied how to build on the established industrial base such as A&G Price, the heavy engineering company which is part of Viking Pacific, the latest incarnation of the old Skellerup group.

It has also looked at trying to establish a new cluster of companies, particularly in marine industries such as boat building and allied crafts. To that end, it worked hard to land Rayglass, an Auckland sports boat builder looking for a place to build a new plant.

Finding a suitable piece of land proved hard. Hemmed in by hills, there are parcels of industrial land but some areas would need to be built up to prevent occasional seaflooding.

The council kept upping the ante, offering in the end to buy and improve a 4.5 acre site for Rayglass. If the company had built on it, the land would have been its for free after five years. It decided against Thames, however, but declined to discuss its reasons for this article.

Losing Rayglass was a big blow to those who worked hard on the deal but they learned a lot in the process. "The mayor, council and local business all pulled together to try to make it work," says Begley. "There's a much greater understanding now of what needs to be done."

Yet, the road ahead is still very difficult, judging by conflicting opinions aired last Monday at a Thames workshop on the development issues.

Basically, the issues come down to what sort of businesses Thames wants, how it will encourage them, who will fund the effort and how the effort will be organised.

The options range from doing nothing to doing a lot.

Some people in the community feel that the local economy has recovered enough to be left to its own devices - after all, perhaps only 30 Toyota people are still there and jobless.

Others believe development efforts should be directed only at building up existing businesses. And still others are more visionary, urging their neighbours to consider how Thames might transform its economic base.

"When they first set up Thames Enterprise, they wanted jobs and they wanted them fast," says one key player.

"They talked of getting 300 new manufacturing jobs by next March but they haven't got any. I think the future lies somewhere else like tourism."

The fact is that Thames is trying to compete with other industrial areas such as south Auckland which have abundant, flat land to offer.

Small-scale, low-impact, knowledge-based industries might be possible but opposition to heavy industry could grow given the rise of the tourism industry and strong environmental lobby on the Coromandel peninsula.

Another unresolved issue is the geographic remit of the development effort. Should it be just Thames? Thames and environs? Or some or all of the district? Should the development body be part of the council, semi-independent or autonomous?

Funding is also a tricky question. Some 50 per cent of ratepayers are absentee owners of holiday homes. Of the 50 per cent who are residents, about two-thirds are on fixed incomes.

And residents of, say Whitianga, are probably keener on their rates being spent on beachfront improvements than encouraging new industry to come to Thames.

However, one hope for funding the council sees is the Labour Party's promise of local development aid should it form the next Government.

These debates about whether to "make do" or to aspire to better will probably flare up in coming months. But at least the local community's development experience so far has helped inform those debates.

"We've realised we haven't got the great town we thought we had," says one local business person pushing to instil a vision of economic development.

"We haven't got the facilities, our hospital is being wound down and managing directors' wives won't come because we haven't got [good enough] schools." But he, like others, is trying to use that realisation to trigger change.

"Thames Enterprise has helped create a sense of positivity rather than gloom and doom," says Councillor Sally Christie, a member of its board.

"It has created a sense that there is a future but we have to find it, to find that leading edge for rural New Zealand."