MG axes Longbridge 'assembly' after five years

By Graeme Roberts | 23 September 2016

MG6 start of production in 2011. The completeness of cars arriving from China can be seen. Even then, insiders admitted to just-auto the English final assembly operation was inefficient

MG6 start of production in 2011. The completeness of cars arriving from China can be seen. Even then, insiders admitted to just-auto the English final assembly operation was 'inefficient'

MG is to stop making cars at its Longbridge plant near Birmingham, central England and will move production to China, media reports said.

The firm said vehicle assembly was no longer "required" and cars would arrive "fully built ready for distribution", the BBC reported.

MG said there would be 25 redundancies but sales, marketing and after-sales operations would remain at the plant.

The first new MG for 16 years rolled off the production line in the West Midlands in 2011

However, the so-called 'production' at the plant near Birmingham, the first since the demise of Rover in 2005, was barely more than a final finishing operation, adding front suspension and engines to welded, painted, wired and trimmed body shells that arrived from China with dashboards and seats already in place.

More than 400 design engineers and other staff at the SAIC Motor Technical Centre (SMTC) at the site and MG Motor employees are not affected, the BBC said.

"Centralising production demonstrates MG's commitment to the future, as well as its continued focus on attracting and developing the highly-skilled automotive engineering and design talent present in the UK," a spokesman for MG told the BBC.

Where possible, production staff would be moved into new roles, the spokesman added.

Two models are currently designed and completed at the site - MG3 and the new GS SUV - and sales are increasing with the firm reporting a total year on year rise of 18%.

Matthew Cheyne, head of sales and marketing at MG Motor UK, said moving production abroad was "a necessary business decision".

Richard Burden, Labour MP for Birmingham Northfield, has criticised the decision, describing it as "hugely disappointing and premature".

"I understand the business concerns that MG have surrounding costs of assembly at Longbridge, which have undoubtedly been aggravated by problems with the strength of the pound," he said.

"However, more discussions should have taken place to explore alternatives and options before any decisions were finalised."

He said the government was willing to meet MG to discuss options and he had hoped the announcement would not be made until further talks had been held.

Autocar, citing Cheyne, said the move had been under consideration for as long as two years.The main reason was MG looking to streamline its production process because its UK plant's production output could not compete with its larger, more modern facilities in China.

"Small volumes aren't economically viable at a site of Longbridge's size. Elsewhere in the world, we have state-of-the-art facilities, so it's more cost-effective to import and build them elsewhere. There was no efficient way to carry on doing it in the UK," Cheyne said.

The move away from UK production was also partially due to the UK's vote to leave the European Union, Cheyne told Autocar. Since the value of the pound dropped following the Brexit vote, the cost to MG of producing its product range rose, rendering the production operations in the UK no longer cost-effective.

Autocar said MG was also starting a new initiative to build a more global product line-up, rather than starting with a car destined for international markets, then re-engineering and designing it to fit into the UK market. Cheyne also denied that the move would have any impact on the price of MG cars, given the economic benefits of moving production overseas.

MG's market share, according to the most recent set of official industry statistics, was 0.12% in August this year. 

Cheyne told Autocar the move would not affect MG's upcoming product plans, including the production of a new small SUV to sit below the brand's current GS SUV. He remained optimistic about MG's future in the country, stating: "Going forward, we have the availability for production to build in China and other markets. We're part of a massive global company, which we haven't been taking advantage of, which we now can."