A report in the Financial Times says that MG Rover’s spending on research and development fell to its lowest level in decades last year as losses at the Birmingham carmaker increased and it suffered engineering setbacks.
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According to the report, which cited the manufacturers latest published accounts as source, MG Rover spent just £14.7m on R&D last year, a fifth of the level four years ago. The report added that in the last year of BMW ownership, Rover – which then included Land Rover – spent 10 times that amount.
However, MG Rover said that the low R&D spend reflected group restructuring and the collapse of Tom Walkinshaw’s engineering consulting firm, TWR, which had been working on the replacement for the Rover 45.
The FT article also said that Rover claimed the R&D spend total was £24m if spending on engines and racing cars – held in separate divisions of the Phoenix parent – was included.
The report added that R&D spending at Rover and Phoenix remains slightly more than 1 per cent of turnover compared with the 4.2 per cent industry average and is the lowest of all the global carmakers monitored by PwC.
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By GlobalDataDaniel Ward, Rover’s new head of communications, told the FT that spending across the group for this year was likely to double as work got under way on the new mid-size car for the latest Chinese joint venture with Shanghai Automotive Industry Corporation (SAIC).
