Trading Update

Tanfield Group PLC
27 January 2006


                               Tanfield Group PLC
                          ('Tanfield' or 'the Group')

                                 Trading update

The Directors of Tanfield are pleased to report on developments in the latter
part of the financial year ending 31 December 2005 and confirm that they remain
comfortable with market estimates for the year just completed.

Significant highlights of this period include:

Tanfield Engineering Systems

The order book and enquiry levels remain strong with the 'assembly solution'
proposition continuing to derive interest from both existing and new clients.
 Further new projects have recently been awarded to the engineering division
from a major manufacturer of civil engineering and construction equipment, and
the scope of a number of contracts is broadening as the Group demonstrates its
capability to these customers.

Smith Electric Vehicles

Interest in the Faraday vehicles is extremely buoyant with many substantial
retail and logistics companies, as well as various public sector organisations,
expressing serious intent. Firm orders have already been received from dairies,
logistics companies, public sector organisations, and an Airport operator and a
number of trials are currently taking place. Further derivatives of the Faraday
platform will be rolled out over the course of 2006 to appeal to specific
sectors within these markets.

The Dairy Crest service and supply contract is now fully implemented and we see
further opportunities to grow with Dairy Crest over the coming years.

Aerial Access

The strategy to broaden market penetration through overseas distributors is well
progressed and a significant level of order intake is being generated through
these new channels. Negotiations are ongoing with a number of additional
distributors and we anticipate further additions to the distributor base over
the course of the year. New powered access products are in the final stages of
development to push through these improved distribution channels and to increase
the product portfolio. The proposed joint venture in China is progressing well
and we expect shortly to be shipping the first of a number of products to this
important and fast growing market.

Norquip

The integration of this acquisition is now complete and we are in receipt of
orders for complete vehicles, both diesel and electrically propelled, for
airport customers worldwide. The renewed sales and marketing activities in this
division have resulted in significant interest. Several European and Middle
Eastern projects are in the final stages of negotiation and are expected to
complete in the short term. The directors are confident that these contracts,
allied to the general growth in the airline sector, will result in significant
order book growth during the year.

JumboTug

Improved distribution and new state-of-the art products are helping this
division to significantly increase it's market share. Recent contract wins with
several UK regional airports have been joined by orders from Poland and Spain.
The divisions zero-emission products are now on trial in London's main airports
and the enquiry levels are at an unprecedented level, including potential
projects in North America, the Middle East and Asia.

We also announce the resignation of John Pither from the board of Tanfield as he
is reducing his commitments. John's contribution and advice over the last 5
years have been of enormous assistance and the board would like to publicly
express their thanks to him. The Company expects to make certain appointments to
strengthen the Board in due course. John Bridge has been appointed chairman of 
the remuneration committee and Martin Groak has been appointed chairman of the 
audit committee.

The Company announces that its Auditors have completed a review of its Interim
Statement to June 2005. They recommend that due to the size of a provision
release disclosed in Note 7 within the Report, this should be treated as an
exceptional item. The Board and the Audit Committee will consider this guidance
for the treatment of this item when preparing the Annual Report to December
2005.

The Board can confirm that Note 7 of the Interim Statement gave full details of
provision movements for the period.

In addition, the board has appointed Baker Tilly as it's auditor and they will
be reporting on the year ended 31 December 2005.

Enquiries:

Roy Stanley, Chief Executive,
Tanfield Group Plc Tel. [phone]

Ruari McGirr,
Daniel Stewart & Company Plc Tel. [phone]




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