People : Lord Stokes
Lord Stokes: He was up against it from day one when British Leyland was formed in 1968…
As is revealed in this interview by Eduard Steiner, which appeared in Auto Motor Und Sport in 1970, it didn’t lessen the man’s optimism for the future, or his pleasure at becoming a Lord. Stokes said he was the company, and the company was his second nature.
Taken from an original text in German and translated by Bjørn Honne
There’s still so much to do…
Lord Stokes: “We need to build a United States of Europe and ought to rise above national rivalries and petty differences of our short-sighted politicians” (Picture: BMIHT)
WE are not a defeated country…” This statement, which Lord Stokes uttered with conviction at the end of the interview, is characteristic of the man, his actions, his commitment. There is something of the British Bulldog in this man, who radiates so much friendliness, and yet even more impressive, so much strength. He has never admitted defeat on his own part, an attitude which has led him all the way from a modest position as a salesman in a lorry manufacturer to the chairman of the ‘British General Motors’.
While an Agnelli or a Ford might acquire their peerage by right of birth, Stokes received his seat in the House of Lords solely by virtue of his staying power and his intelligence. Who could imagine a better title for someone which name is forever to be associated with the company, where the man is entwined with the corporation whence he emanated and to which success he has made such a major contribution: Lord Stokes of Leyland…
Stokes: “I think my elevation to peerage pleased my wife more than anyone,” Lord Stokes says. “Just imagine people addressing her as ‘Your Ladyship’,” he smiles.
“As far as I am concerned,” he continues “my peerage has but one advantage, namely as a lifetime peer, I may directly and publicly question any member of the cabinet. I might not exercise this right, but the knowledge of my abilities to do this, should suffice for the parties concerned. In certain cases, I may be urged to act upon it…”
(One finds Lord Stokes very little affected by the archetypal English adherance to tradition, which is so frequently portrayed in Continental caricatures. That is, but for a few aspects: the well-developed sense of humor, the conquering disposition, and the enviable talent for getting by in everyday life without taking oneself too seriously).
Stokes: “I am somewhat surprised and concerned about these questions I am asked,” Lord Stokes says, “especially as you ardently maintain that the social unrest, the so-called ‘wild strikes’ are cause for serious concern. Labour relations in France and Italy are, as far as I know, not exactly models of civility. However, the public seems hypnotised by a minor number of strikes in England and oblivious of the actions within Ford of Detroit and the entire French industry just a short while ago.
“Perhaps our strength lies in the fact that we have all this minor unrest, and not the violent social explosions that occur elsewhere. The entire world seems to be confronted by an uprising; an outbreak of individuality that rebels against the established order and the social fabric of society. As far as we are concerned, we have an excellent relationship with our trades union. However, it is not to be denied that the unions no longer fully control the majority of their membership…”
Edouard Steiner: “Last year you told me any problems with social unrest within a company was a question of management. A well-managed company, you said, was one in which such problems did not arise.”
Stokes: “I remain convinced by this, in so far as the crisis is not caused by the political background. Moreover, I believe that because of better management the corporation after the foundation of British Leyland less time has been lost to stoppages than the separate companies before the merger. We and Rootes pay the highest wages in the English car industry. In the first twelve months of its existence, British Leyland was able to increase its production with sixteen percent with a reduced headcount. In the following six months, we noted a further ten percent increase from the new level to the present. Today, we are a thoroughly sound and vital corporation.
America’s Interest in Small Cars.
Eduard Steiner: Without doubt, your expansion has profited from the continuous boom which, fuelled by corporate sector superheating, has boosted most markets for the past two years.
Stokes: “British Leyland built more than a million vehicles in 1969, in spite of strikes which cost us over about 100,000 units. This loss cost us potential sales in every sector of the market, particularly so for sports cars and the Mini. With the exception of the Maxi line, all our production lines run to maximum capacity.”
Eduard Steiner: “Even so, you have not reached all your goals. In the United States, for example.”
Stokes:: “That is correct. Our goal was to ship 110,000 vehicles overseas, and we managed only 90,000 as we could not produce the required numbers. However, the market in the US is swinging our way. Now that the Detroit industry builds its own small cars, small cars in general become more marketable. Thanks to Ford and soon also GM, the small car is no longer seen as the car of the poor. At the same time, however, the customer wishes for an individual car. Our very broad model programme, which also comprises sports cars, makes it possible for us to fulfill such wishes. I might add that I do not find it desirable that BLMC should export more than 150,000 cars to the US. We want to hedge our bets and not put everything on one card as Volkswagen has done. One should exploit the opportunities of the American market without becoming too dependent upon it.”
All production lines, barring Maxi, were running at full-capacity
Eduard Steiner: “You will concentrate, then, on improving your position within the Common Market, where your market penetration, above all in Germany, has decelerated.”
Stokes: “Definitely. Therefore, we are in the process of increasing our production capacity on the continent without awaiting any decision regarding the inclusion of Britain in the Common Market. Our plant in Belgium will give us a capacity to build 110,000 cars within the Common Market when it comes on stream in 1971. Furthermore, we are setting up in Spain, particularly with South American exports in mind.
“By the way, I think it unavoidable that England join the Common Market. We need to build a United States of Europe and ought to rise above national rivalries and petty differences of our short-sighted politicians. The real danger stems, in fact, from the combined industrial powers of the United States and Japan. We need to unit in order to meet this threat, and Britain is ready to do so. Twenty years ago, Britain was not European in outlook. But in the meantime we have become so. We no longer live on an island, mentally. Likewise, I am convinced that it will come to further mergers in Europe. This is the only way to hold our ground against the American and Japanese competition. British Leyland holds solid assets which we will develop further. We are very positive towards the thought of co-operation with other European manufacturers. I have no firm preconception of which form such co-operation might take, but to me a good example is our delivering body parts to Renault. In any case, we are ready to enter talks.”
Objective Attained: The Merger
(If one wanted to sum up Lord Stokes in two words, one could call him an empirical humanist. His proudest achievement is to have accomplished the merger between Leyland and BMH in record time).
Stokes: “At first, I thought it would be three years before we could gather the fruits of the merger. In actuality, however, things went a lot quicker. Within the first year, we were able to show gains we had not calculated with. In the beginning I was forced to live the life of an autocrat for the whole of six months. But afterwards I could rapidly alter my manner. We have heard every party concerned on every problem. Everyone was informed on pretty much everything because it is a counterproductive attitude to maintain secrecy on certain technical matters within the corporation for the simple reason that almost every secret is leaked in some way or other.
“Everyone was allowed their free say, which on its very own created something of a constructive psychological shock. Besides, I made sure that the discussions took place in the factories concerned rather than in our headquarters. That brought psychological benefits. Because of this, no lasting tensions has arisen from the merger. To the contrary; we were successful in installing a new enthusiasm. And yet nothing was more difficult than this: British Leyland comprises about 60 different factories, some of which are seventy years old or more. These works naturally form their particular habits and traditions. Thanks to a committed public-relations effort we succeeded in convincing 190,000 employees of our plans and our common purpose.
“To your question what appeared the most remarkable feature of British Leyland in 1969 I could easily have pointed to some quantifiable result. I prefer, however, to say that our greatest success lies in the psychological plane. The feeling that our merger is a success, that there is truly a British Leyland in which the employees are merged into a new form of entity, not as hitherto member of some team or other but now as a member of one new large family, British Leyland, which exists in its own right.
New Models Wanted
Marina prototypes were ready to drive by the end of 1968.
(Lord Stokes likes to point to the fact that British Leyland can make major decisions in less time than BMC thanks to a new managing system).
Stokes: “Our management have accomplished great things already. Therefore the first mass-production model that was conceived after the merger will be released towards the end of the year. The prototype was ready for me to test drive on Christmas Eve of ’68 in fact – British Leyland is incredibly flexible.”
(Lord Stokes does not see the Austin Maxi as a true BLMC car, but as an inheritance of the BMC. It would seem that the management in London does not harbour major illusions regarding its European future. Predictions for sales in France are as low as 1500 cars per annum.)
Stokes: “Its greatest merit is that it exists. We postponed the launch to hone this wholly new car a bit further and finally brought it to market in awareness of its limitations. This is a car which will succeed in the home marked (where its current market share stands at 2.3 per cent). One should not forget that the 1800, which was a marketing failure when viewed on international basis, equally stands at 2.3 percent in England and that there is a six-month waiting list. The Maxi is a very valuable car in the home market. For the rest of the world, we have different plans. In fact, we plan to launch a new or fundamentally modified car every six months, and our annual production should reach 1.5 million within five years.
“British Leyland is in the middle of a period of changes, both technically and commercially. The Cowley Works wer completely reorganized into a completely autonomous entity which will manufacture complete cars. The Corporation has an investment budget of £60m in 1969 which is set to rise to £80m this year.
“Last year, we brought our overseas operations in the US, South Africa, Australia and New Zealand under a common umbrella. We have started the process to optimise the potential of our combined UK dealer network, which is a true gold mine. European distribution is now centralised in Lausanne and there are now one national import company each for Norway and Austria. We will continue in this direction. British Leyland will have dealers everywhere.”
Eduard Steiner: “You had plans for Eastern Europe. Now it would seem that you have come no further in this direction.”
Stokes: “We might have accomplished something in Eastern Europe, particularly in commercial vehicles. But I am careful not to overstretch my resources: first our own house must be in order. At the end of the day, the main task is to sell the products of our own house.”
Eduard Steiner: “After a few months’ break, you are back in motorsport, seemingly halfway by means of a back door. Will you engage more widely in this field in the future?”
Stokes: “The point of motorsport is not to participate but to win. I am personally very positively disposed towards motor sports, with the precondition, that our cars have a fair chance of proving themselves. But I find it a great shame the way in which motor sports has developed into more of a financial than a technical competition. The public is well aware of this. I fear that the spectators will turn their back on the sport as financial concerns increasingly outweighs sporting merit. Still, I am fully aware of the importance of motor sports. Within the corporation, Jaguar cars are most apt for competition. The greatest problem is deciding the right moment for making a come-back.”
Eduard Steiner: “Obviously annoyed with strike action within certain suppliers, you have threatened to source emergency materials supplies from abroad, particularly from Japan. Have you acted upon these threats?”
Stokes: “No, I haven’t. But I was quite right to make such threats. They helped.”
Eduard Steiner: “In all, you have shaken quite a few people and their old habits, both inside your company and outside…”
Stokes: “Some ventured the opinion that we were showing our teeth in order to bite. Later they would discover that those were in fact our wisdom teeth.”
Original article supplied by Ian Nicholls