What’s in a brand? The Chinese think that being British makes MG special. Here in Britain, the reality is that it must compete in the bargain basement.
It is supposed to be easier and cheaper for a car company to take over an established brand than starting anew with an unfamiliar name and no reputation or track record. Tata’s acquisition of Jaguar Land Rover and the Geely takeover of Volvo would seem to prove that proposition: two newcomers on the automotive world stage have taken advantage of the heritage and goodwill of long-respected brands. And then you look at MG.
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MG is, officially, the ‘export brand’ of SAIC (Shanghai Automotive Industry Corporation), China’s biggest car manufacturer and partner of both Volkswagen and General Motors.
You may recall that SAIC and NAC (Nanjing Automobile Corporation) each found themselves with the remnants of MG Rover after it collapsed in 2005. SAIC, which had an established technical partnership with MGR, gained the intellectual property and NAC paid GBP53m for the tooling and equipment and the rights to various brand names, including MG. Both companies set up to make derivatives of Rover models in China. Three years later, the Chinese government ‘encouraged’ SAIC to take over NAC and their products were combined as Roewes (the nearest name to Rover it was able to use) and MGs.
When the first MGs, for Chinese domestic consumption, came off the production lines at Nanjing, the company played up their British origin and translated the name as ‘Modern Gentleman’. By the time of SAIC’s involvement and plans for overseas sales, it had learnt that MG really stood for ‘Morris Garages’ and was persuaded that it should exploit the marque’s 85-year history.
SAIC had a large stand at the 2011 Shanghai Motor Show, split between Roewe and MG. Behind the display of the MG3, which was making its debut, was facsimile of a wooden-panelled 1920s showroom with an illuminated Morris Garages sign and inside was an authentic 1920s car: it was an Austin 7.
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By GlobalDataThe company seemed unconcerned by this blunder and didn’t even offer what might have seemed a valid excuse – that the Austin 7 was built at the Longbridge plant, where NAC had taken a 33-year lease on part of the site to re-establish MG in the UK.
Restarting MG production in the UK was part of the deal that NAC made with the MGR administrator. It was said that it planned to re-employ 1,200 people at Longbridge and produce 100,000 cars a year but at a press conference in London in July 2006, attended by representatives of unions and suppliers, the president of NAC reduced those figures to 15,000 cars a year and a ‘few hundred’ employees.
It was a bad-tempered meeting where everyone felt let down but the reality would be worse still. All that came down the lonely production line in the huge Longbridge assembly hall was a trickle of MG TF sports cars, built from Chinese-made components. The MG TF was already 11 years old and was never going to sell in significant volume. It was the last of a line of two-seater sports models – the cars that defined MG through the years and generated the world’s biggest marque fan clubs.
The future would be different. SAIC decided that it first car for export would be the MG6, a mid-sized family hatchback loosely based on the Rover 45/MG ZS replacement which it had been developing with MGR. SAIC’s UK engineering department – some 250 people – was moved to Longbridge and a small MG design studio established there. The cars, 80 per cent complete, with painted and fully-trimmed bodyshells, would be brought from China in containers and married to the engine/transmission sub-assemblies (also from China) on the final assembly line at Longbridge. Thus, MG was able to claim that the cars sold here were ‘Engineered, designed and built in Britain’.
It took until April 2011 for the first of these cars to emerge from Longbridge. MG Motor UK said that it expected to sell 2,000 cars in 12 months, through 40 newly-appointed dealers, and that sales in other European countries would start within one or two years.
The critics gave the MG6 a warmish reception. SAIC’s ex-Rover engineers had ensured that it drove well but the engine (petrol only to start with) wasn’t very refined and some aspects of the finish and interior trim were poor. Its problem was – and is – that it is resolutely ordinary. In size terms, it fell between the C and D market sectors and yet, at £15,500, didn’t look particularly good value in either. In 2012, its first full year, 782 MG6s were registered in the UK.
The introduction of a diesel engine and a four-door saloon version, using the heritage name Magnette, couldn’t raise MG’s game and in 2013 it actually sold fewer cars (504) than the previous year. Plans for sales in mainland Europe were suspended.
UK sales numbers have improved since then – 2,326 last year – thanks to the arrival of the MG3, a well-priced and standard-sized B-sector supermini. A small SUV crossover is due to join the range next year (and seen at the Shanghai Motor Show). In the meantime, there has been a re-think about the MG6 and its place in world. The range has been cut back to one model – a diesel hatchback – with three trim levels and prices GBP3,000 lower than the 2014 equivalents. It now starts below GBP14,000.
The improvements are worthwhile and meet most customer and press criticisms of the earlier cars. The MG6 can now be seen as what it is: a competent and spacious car for a family on a budget, as the Skoda Octavia was on its journey to the big league, or as Dacia is today.
Which raises the question: why MG? Company officials admit that although they would like a sports car there is little prospect of getting one. SAIC either doesn’t appreciate or doesn’t care about the MG’s heritage or that the brand today has none of the characteristics that made it famous. It used to be known for its affordable sports cars and even in its darkest days as part of Leyland, BL, Rover and MG Rover, when its products were largely badge-engineered saloons and hatchbacks, MG was presented as the sportiest brand, commanding a price premium over its stable-mates.
Today, in Europe, I reckon that MG could sell just as many of its current cars if they were called Shanghai or Nanjing, or, like Chinese scooters, branded by the retailers with inconsequential made-up names. But in China it is a different story. Customers in the world’s biggest car market may not understand the significance of MG but they do know it as a famous British brand.
MG and Roewe are promoted in the domestic market with images of Union Jacks, red phone boxes, Tower of London beefeaters, and Tony Blair’s Cool Britannia. MG’s latest move is designed to reinforce that connection. SAIC has spent millions on a seven-storey building on Piccadilly at the heart of London’s West End. It will provide some offices for its European operation but the main reason is to open a flagship MG showroom next to the Royal Academy and opposite Fortnum & Mason – closer than any other car maker to Piccadilly Circus, the centre of tourist London. It wants the MG octagonal logo to rub shoulders with the world’s most prestigious fashion houses and their Mayfair boutiques. We can see a mis-match here but the Chinese can’t. They are proud to have actor Benedict Cumberbach as an MG brand ambassador in China. Perhaps Modern Gentleman wasn’t such a bad translation after all.
See also: Q&A with David Lindley, SAIC Motor Technical Centre, UK
