News : 17 July 2008

News digest

Compiled by Clive Goldthorp

1) SAIC Motor/MG and Roewe

MG3 SW – the car that will make MG in China
China Car Times, 11th July, 2008

China Car Times has decided that the MG3 SW is going to be the car that turns MG into a well known brand in China. It wasn’t a long, hard, thought out decision; it was a rather easy decision to make actually.

You see MG have started an aggressive media campaign for the MG3 SW – if you’re in China right now you can bet at least 100USD per person that you’ve seen this advert at least 50 times before you brushed your teeth this morning. The latter may well be a slight exaggeration on China Car Times’ part but, on a serious note, the advert and various other MG3 SW adverts are getting massive amounts of coverage. They are being played on national Chinese television at peak times, when young families in need of a rugged motor are more than likely to be watching. I have even found myself watching the advert again in the elevator on the way to the office, both inside the lift and when pressing the button to go down or up.

How is all of this media attention going to help NAC MG sell more MG3 SWs? Well, for a start they are targeting the campaign at just the right audiences: office elevators (white collar workers), prime time TV (white collar workers after work) and in traditional print media. Roewe went from being an unknown brand all over the world, to being a reasonably well known brand in China in the space of 3 months thanks to an aggressive advertising policy. Nanjing MG are doing the same but, instead of showing off their MG7 sedan, they are showing China their mini hatchback crossover.

The MG7 never got this amount of media attention when launched – that was a mere ‘wooooo, look we made a car‘ which gained a short (but sweet) amount of time in the press and in adverts. The change in media perception for MG is nothing short of a complete turn about for Nanjing MG. This time the message is clear ‘Wooo, look we made a car, and we’re going to sell thousands of them.’ Obviously China Car Times jests, however, it will be amazing for potential clients to visit the MG dealerships to see the MG3 SW and then think they’ve stepped into an upmarket brand’s dealership. MG dealerships are very luxurious, the service and attention to detail is very much what you would expect from Bentley, Jaguar, Mercedes etc.

In short, as the advert says, the MG3 SW is a car that crossed boundaries and went on the market and will no doubt go on to be a massive sales hit for MG. We think it’s safe to say that MG is back.

2) Jaguar – Land Rover

Jaguar XFR stars at Goodwood
Will Powell,, 14th July, 2008

The British firm’s new 500bhp super saloon made a number of high speed runs up the famous hill, with veteran test driver Mike Cross behind the wheel. Jaguar officials are still cagey about confirming the XFR’s existence, describing the disguised saloon as a ‘sports prototype’. But sources close to the XFR project hinted that a production model could be expected in March 2009.

The Jaguar XFR will be powered by a new direct injection, supercharged 5.0-litre V8 with 500bhp on tap. Expect scorching performance as a result; the XFR capable of dismissing 0-60mph in around 4.5 seconds and pressing on to a limited top speed of 155mph. Gaydon’s also expected to offer an option to remove the limiter, so 180mph+ will be possible.

The R will have a lower ride height and stiffer springs than today’s sportiest XF, the SV8. But that model will remain on sale to satisfy drivers who want a more comfortable chassis. The XFR will be the hardcore model. Cosmetic changes include more vents and grilles to aid cooling, more aggressive bumpers and 20-inch alloys. Although Jaguar has agreed supplies of a new eight-speed ZF auto ‘box, at launch the XFR will only be available with the familiar six-speeder.

XFR prices will be confirmed nearer to the car’s launch, but the SV8’s £54,900 price tag means we anticipate that buyers won’t get much, if any, change from £60,000.

Concerns over Tata’s debts after taking on Jaguar Land Rover
Birmingham Post 10th July, 2008

Brokers in India are continuing to monitor the performance of Tata Motors following its acquisition of Jaguar Land Rover. Analysts are concerned that the company may have saddled itself with too much debt in its attempts to acquire the two iconic brands, which it eventually secured from Ford in May in a deal worth £1.15 billion.

The company’s shares dipped by more than four per cent earlier this week and Standard & Poor’s Ratings Services – an international monitor of companies’ performances – said it was still taking a negative view of Tata, pending the outcome of long term financing plans covering the acquisition.

S&P said Tata Motors raised short term bridge facilities of £1.5 billion to fund the initial transaction, which it plans to repay through a mix of fresh equity infusion, liquidation of investments, and long term debt. There are also concerns in India that while Land Rover has proved successful, Ford never made money from Jaguar.

Ironically, the two marques are enjoying a change of fortunes at the moment. Jaguar is riding the crest of a sales wave on the back of its popular new XF model, while Land Rover is struggling, probably due to concern over high fuel costs. Despite the situation, Tata has said it will not shrink from making major investments in the two companies.

Managing director Ravi Kant said in an interview that the firm was committed to the two brands in the long term and would do whatever was required in order to make them successful. He has said changes to the business plan agreed with Ford may be necessary if the current arrangements did not work out, although did not specify what they might be.

There is also speculation the company may invest in a new Jaguar sports car, as revealed in The Birmingham Post earlier this year. The sports cars produced by the firm down the years are known to be favourites of the company’s chairman, Ratan Tata. Mr Kant said the firm had listened to the comments of a lot of people connected with company and the sports car sector and would be taking these into account when it drew up its plans.

Vintage Jaguar sold for over £2m
Birmingham Post 11th July, 2008

A vintage Jaguar racing car was snapped up on Friday for a world record price of more than £2 million. The 3.4-litre car was the first Jaguar D-Type to roll off the production line in 1955.

The motor car with the chassis number XKD509, was sold for £2,201,500 following frantic bidding at the auction held at the Goodwood Festival of Speed in Chichester. A British vintage car enthusiast bought the much sought after motor at the Bonhams sale. The price beats the previous world record set for a Jaguar car of £1,706,000 set in 1999.

The XKD509 was sold on behalf of the Littlewoods Football Pools’ family and was raced in America in the 1950s. Hundreds of motor enthusiasts crammed in to the six-hour sale as more than 350 lots went under the hammer.


Mini to get “Italian Job” in cost-cutting deal with Fiat
John Cranage, Automotive Correspondent, Birmingham Post, 8th July, 2008

The Mini looks set to get an “Italian Job” makeover as parent group BMW negotiates a cost-cutting deal to develop components and platforms with Fiat. It could mean the next generation of Oxford-built Minis sharing key parts with a new, small Alfa Romeo. A statement last night said that BMW and Fiat “are considering the possibility of co-operation in the areas of architectures and components for their Mini and Alfa Romeo vehicles.”

A memorandum of understanding has been signed by Friedrich Eichiner, BMW’s director of brand development, and by Alfredo Altavilla, a senior vice-president of Fiat. “We are currently examining with the Fiat Group possibilities for the joint use of components and systems in Mini and Alfa Romeo vehicles in order to achieve economies of scale and thus cost reductions,” Mr Eichiner said.

Fiat chief executive Sergio Marchionne said: “The proposed co-operation with BMW is a significant cornerstone of our strategy of alliances. We are delighted to work with such an esteemed and respected partner in the automotive industry with the clear objective of improving the competitive position of both parties.” BMW and Fiat are not revealing details of the possible collaboration and say any deal will not be finalised before the end of the year.

Automotive industry experts said last night a deal with Fiat would fit into BMW’s “Strategy Number One” which is aimed at slashing costs. The Munich group, which also builds Rolls-Royce super-luxury cars at Sussex, plans to axe some 8,100 jobs (mainly managerial roles), equivalent to about 7.5 per cent of the workforce, by the end of this year.

The company, the world’s biggest producer of premium cars, already has a successful engine development strategy in place with French group PSA. This has already yielded a highly efficient 1.6 litre petrol engine that goes into Minis, Peugeots and Citroens. BMW builds its version of the engine at a plant at Hams Hall, near Birmingham.

It is also involved in a project with its arch-German rival, Mercedes-Benz, to develop hybrid engines for luxury cars and has said it is looking for other areas in which to co-operate with the Daimler-owned marque. Many of the world’s top carmakers are seeking to strike strategic alliances in order to combat soaring raw material costs and cut the astronomical costs of designing and developing new models.

4) India Watch

Tata Nano could come with optional air-powered engine
Motor Authority 10th July, 2008

Tata may no longer be able to keep its promise of delivering the upcoming Nano minicar for $2,500 but the Indian carmaker may be able to offer customers another reason to buy the groundbreaking car. In addition to the 33hp (25kW) petrol version, Tata is expected to release an air-powered model running a compressed air engine from MDI Enterprises.

The engine emits one-third the carbon dioxide of conventional motors of the same size. Cold air, compressed in tanks to 300 times atmospheric pressure, is heated and fed into the cylinders of a piston engine. No combustion takes place, so technically there is no pollution actually produced by the car, although the energy needed to compress the air may still come from polluting oil- or coal-burning power stations.

A Nano featuring the air-powered engine would be able to travel up to 200km for just $3 worth of electricity.

Officially, Tata is remaining quiet about any compressed air variants of the Nano and its uncertain what the option will cost. The news, reported recently by the New York Times, was first revealed after Tata’s signing of a deal to license the technology from MDI. A compressed air variant of the Tata Nano will have environmentalists breathing a collective sigh of relief after concerns that the Nano could be the ‘beginning of the end’ for the environment as millions of new drivers India start to adopt cars.

MDI is also set to enter a compressed air vehicle in the Automotive X Prize competition in collaboration with Zero Pollution Motors in an attempt to prove that compressed air vehicles are a viable alternative internal combustion and electric vehicles.

Posted in: AROnline News
Keith Adams

About the Author:

Created in 2001 and watched it steadily grow into AROnline. Is the Editor of Classic Car Weekly, and has contributed to various motoring titles including Octane, Evo, Honest John, CAR magazine, Autocar, Diesel Car, Practical Performance Car, Performance French Car, Car Mechanics, Jaguar World Monthly, Classic Car Weekly, MG Enthusiast, Modern MINI, Practical Classics, Fifth Gear Website, and the the Motoring Independent... Likes 'conditionally challenged' motors and taking them on unfeasable adventures all across Europe.

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