As BMW breathe a sigh of relief and Alchemy look at how to turn around an ailing automotive manufacturer what’s left at Longbridge? Have your say here by sending an email to editor@just-auto.com. We will publish the best quotes and you can remain anonymous if requested.
Some points we’d like your opinion on are:
Go deeper with GlobalData
What went wrong?
Who is to blame?
What does the future hold?
Scott Allo, Automotive Editor, Forecast International News and Analysis Service.
“My take on the Rover/BMW situation is this:
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData1. BMW spent lots of money trying to turn Rover around the way Ford did with Jaguar. However, BMW doesn’t have the deep pockets that Ford does, so sooner or later, BMW would have to cut Rover loose.
2. Being American and listening to the rants and raves of our own Union of Automobile Workers everytime Ford or GM tries to something against the wishes of the union, I can somewhat understand Tony Woodley’s situation. That said, I believe Mr. Woodley is behaving like a child whose been told to go to bed without his supper.
Mr. Woodley should be very cognizant of the fact that BMW poured time,
money and energy into Rover, only to see it disappear into a black hole. Therefore, I find it not surprising that BMW pulled the plug when it did.”
John May, MD of World Automotive Industry Trends
“It’s hard to see how Rover can survive. There is massive overcapacity in Europe, it would help everybody else if Rover’s 400,000 cars weren’t there.”
Tony Woodley of the Transport and General Workers Union
“We are dealing with a dishonest and dishonourable company (BMW) who have connived behind our backs, having reached an agreement to sell off Rover cars. We are dealing with venture capitalists and asset strippers who are looking to make a fast buck and who do not give a damn about Rover or its employees.”
Anonymous
“Surely this cannot be a surprise! At the end of the day this is pure economics – Longbridge is out of date and cannot compete with newer plants. You only have to look at the number of cars per worker – Rover produces an average of 30 cars each, compared with 105 per worker at Nissan’s Sunderland plant.”
Article Feedback: just-auto reader, submitted by email. No name given
“I blame the lazy people of Birmingham, I used to driive a car transporter for contractor for Rover and all I could see was a load of work shy employees doing nothing.. BMW gave Rover a chance Rover yet again blew it……”
Ex Rover senior employee who saw it all go to pieces and was powerless to stop it!!!(name supplied)
“The breakup of Rover is down to one thing. Six years of BMW mis-management with half their people back in Munich fighting to proove to the other half that buying Rover was wrong in the first place!!
A sucession of “U” turns on policy and strategy changes resulted in vast quantities of BMW’s money being wasted. All Rover needed was a medium car that would appeal to customers and sell. BMW never gave it the chance to do that, instead, squandered it’s money on Design Offices with continental streets in, scrapping good ecconomic lightweight engines (because they weren’t designed by Germans!) and spendng huge money on developing not so good ones and developing a car (R75) which competed with their own range, so much so that they had to “rubbish” front wheel drive in their own BMW adverts! A practice that Milberg promised he would stop but never did!
Article Feedback: just-auto reader, submitted by email. Name supplied
It’s easy with hindsight, as always, but this situation was at least five years in the making. BMW didn’t necessarily cause all the problems at Rover, but neither did it actually solve any, until at ‘five minutes to midnight’ (their words, of course), they dropped the prices of the R25/R45 models to almost competitive levels for the first time in their production lives.
The product range was ageing, and overlapped the BMW range in too many sectors (no prizes for guessing which cars BMW would develop and which they would let stagnate, which hardly did the Rover image any good). The build quality was variable (not uniformly bad as some would have us believe – there seem to be just as many satisfied Rover owners as disgruntled ones, and the balance wouldn’t seem to be much different to Ford or Renault), the pricing optimistic and the marketing became increasingly bizarre (the overpricing may have pre-dated BMW’s ownership, but they never bothered rectifying that).
To this, BMW added some pitfalls of their own. In the last five years there has been just one new Rover model, and was it the Golf-sized car that may have made some money for Rover and complemented BMW’s own range? No, we got the Rover 75, which by all accounts is a fine car (although some motoring journalists have seen fit to write off the entire car on the grounds that it doesn’t have Lotus Elise levels of driver involvement), but it was launched in the image-conscious executive sector without an image to speak of, to a fanfare of job loss threats by the then chairman Bernd Pischetsrieder, which undermined the car from day one. It also competed in the same price bracket as the 3 & 5-Series BMWs, which meant that an aspirational, aggressive image was out of the question. A perfectly sensible ploy in the interests of product differentiation, but it missed the mark.
In the meantime, the job of breadwinner (from fleet & private customers) was left mainly to the Rover 400 which was a reasonably competent Astra/Escort rival (like its half-brother, the Honda Civic), which would have been fine were the prices not positioned firmly in the Mondeo/Passat class.
Any car, no matter who made it, would have struggled under the same circumstances.
Another problem may have been that there was no loyal customer base in its home market, unlike almost every other manufacturer in Europe. No matter how bad Renaults & Fiats got in the 1970’s and 1980’s (and as a former Fiat owner, they did get very bad indeed), the French & Italian markets were theirs for the taking. Unfair and uncompetitive maybe, but a fact of life all the same.
BMW struggled, and in the end failed, to get the branding right. Thirty years of being able to employ exactly the same marketing and product strategy (sporty, rear-drive saloons & coupes, which ended up virtually selling themselves by the mid-1980s) exposed a considerable inexperience & ineptitude in trying to turn anyone else’s image around. (it they’d got hold of Skoda, people would still be making jokes about them…) People seemed surprised by this and claimed that Rover had always been a lost cause: after all, if BMW couldn’t succeed, what hope did anyone else have? In fact, BMW’s managerial limitations would seem to have been greater than anyone thought, most of all BMW themselves.
The last few weeks have seen BMW accused variously of arrogance,
incompetence and secrecy over the sell-off. BMW claim that the sale of Rover was a commercial decision that anyone would have made under the circumstances. True, but it was a situation mostly of BMW’s own making in the end. They owned Rover for five years: with this came some responsibility, surely? Billions in investment capital may have been spent, but not, it would seem, in the right place (a brand new factory may have helped in the struggle to increase production efficiency, for example.) or in the right product. It leaves a sour taste, then, that BMW continue to blame everyone else, including an outrageous attack on the British car-buying public, while failing to acknowledge their own part in this situation. They’re not as clever as we might have thought.
