British Leyland in the Times - 1974 - Waterloo

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JANUARY 1974

AUSTIN MORRIS-Work begins on the ADO88 project, intended to replace the Issigonis Mini.

January 1st 1974

The three day week comes into force.

The Three-Day Week was one of several measures introduced in the United Kingdom by the Conservative Government 1970-1974 to conserve electricity, the production of which was severely limited due to industrial action by coal miners. The effect was that from 1 January until 7 March 1974 commercial users of electricity would be limited to three specified consecutive days' consumption each week and prohibited from working longer hours on those days. Essential services (e.g. restaurants, food shops and newspapers) were exempt.

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January 2nd 1974

Car companies' bleak start to 3-day week

By R. W. Shakespeare
The motor industry looks as if it is going to find itself right away in the front line of union and shopfloor opposition to the three-day week. Most of the big Midlands and Merseyside car plants were again at a standstill yesterday, after being idle since before the Christmas holidays began. This was because workers in those plants that have been allocated power for the first three days of this week declined to forfeit the new statutory New Year's Day holiday and take time off in lieu later in the week. In practice, this means that many motor companies will get only one day's full production this week. They will be able to start up today but will have to shut again for the remainder of the week because they will be without power. The car unions will also be insisting on full implementation of guaranteed lay off pay agreements. Many car workers are expected to refuse to work Saturday shifts unless they are paid for at full overtime rates. Even if this is agreed to by the motor firms, Saturday absenteeism may still seriously hit production. One big car plant that did try to operate ran into problems because of absenteeism. This was the British Leyland Rover factory at Solihull. So many workers failed to turn up that production of the 2200 and 3500 models had to be stopped, About half of the textile mills in the Blackburn area of North Lancashire were working with up to 90 per cent of their workers present. They had agreed to work during the holiday and take Thursday and Friday off instead. Many workers at hosiery mills in the Nottingham area agreed to similar arrangements, as did the 5,000 labour force at the Rolls-Royce factory at Crewe. The Lucas group reported that five of its 12 factories were operating yesterday, and the majority of Wilmot Breeden's 4,000 workers in the Birmingham area turned up for their shifts. The Government has handed out a new year gift to 40,000 workers in the pottery industry with the promise of a four or five-day working week. The Department of Trade and Industry have agreed to include the ceramics industry among the list of industries dependent on continuous working.

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January 7th 1974

British Leyland, the biggest of the car companies, averages £32m worth of vehicle production a week in normal times, ranging from Minis to double-decker buses, and including both high-volume and quality car models. Under the three-day week arrangements, it can expect to achieve about 60 per cent of normal output and this would cut production by between £12m and £13m a week.
The same sort of calculations apply right across the engineering industry, with its three million workers all on short time. Any attempt by plants engaged on purely assembly operations to step up output levels during their " power on " days would be countered by shortages of components from their suppliers. The effect on unit costs is much more difficult to calculate, because there is a cumulative cost to be borne as materials and components pass through the pipeline of various companies. It seems clear, however, that, taking the motor industry as an example, the present reduced output levels mean that many models, especially in the volume car sector, will be made at a loss. Fixed overheads will remain, although less materials will be used, and the majority of companies are not only having to honour guaranteed week agreements for their workers, paying them up to 80 per cent of basic rates for periods when they are idle, they will also, when powerr allocations come in the second half of the week, have to pay overtime rates at time and a half for Saturday working and double time when shifts extend into Sunday. The extra cost is already raising serious doubts about whether Saturday working can be sustained if the power crisis measures continue for any length of time. Government ministers and the Department of Trade and Industry will be coming under strong pressure from industrial leaders, following the first experience of Saturday working, to alternate the power rotas so that all companies get their share of weekend working. Employers' organizations, some of whom will be seeing ministers today, will be pointing out that there are big anomalies in the present system both for managements and their employees. The first weekend of the system brought a good response by workers generally to the Saturday shifts, with absenteeism lower than had been fore- cast. This was partly the result of the uncompromising attitude by most of the big unions, which ensured that overtime rates were being paid in most sectors of industry. But British Leyland got only half a day's output from its 19,000 workers at the Austin- Morris car plant at Cowley,The same sort of calculations apply right across the engineer- ing industry, with its three million workers all on short time. Any attempt by plants engaged on purely assembly operations to step up output levels during their " power on " days would be countered by shortages of components from their suppliers. The effect on unit costs is much more difficult to calculate, because there is a cumulative cost to be borne as materials and components pass through the pipeline of various com- panies. It seems clear, however, that, taking the motor industry as an example, the present reduced output levels mean that many models, especially in the volume car sector, will be made at a loss. Fixed overheads will remain, although less materials will be used, and the majority of com- panies are not only having to honour guaranteed week agree- ments for their workers, paying them up to 80 per cent of basic rates for periods when they are idle, they will also, when pn-A-pr allnr-tions come in the second half of the week, have to pay overtime rates at time and a half for Saturday working and double time when shifts extend into Sunday. The extra cost is already rais. ing serious doubts about whether Saturday working can be sustained if the power crisis measures continue for any length of time. Government ministers and the Department of Trade and Industry will be coming under strong pressure from industrial leaders, following the first ex- perience of Saturday working, to alternate the power rotas so that all companies get their share of weekend working. Employers' organizations, some of whom will be seeing ministers today, will be pointing out that there are big anomalies in the present system both for managements and their employees. The first weekend of the system brought a good response by workers generally to the Saturday shifts, with absenteeism lower than had been fore- cast. This was partly the result of the uncompromising attitude by most of the big unions, which ensured *that overtime rates were being paid in most sectors of industry. But British Leyland got only half a day's output from its 19,000 workers at the Austin- Morris car plant at Cowley, and Chrysler could run into trouble at its Coventry car plant this week, because the three-day, week arrangements are being complicated by the effects of an internal labour dispute.

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January 8th 1974

Sit-in protest at Leyland plant over lay-off payment

By R. W. Shakesneare

The three-day week arrangements brought a fresh problem for British Leyland at its plant at Cowley, Oxford, yesterday. Its 19,000 workers have been allocated Thursdays, Fridays and Saturdays as "power on" days. Its workers were therefore not required to report for work yesterday. However, after a weekend meeting of between 2,000 and 3,000 " indirect " workers, those not involved in assembly operations-about 300 men turned up at the plant yesterday and staged a sit in until their normal shift ended at 4 pin. The men said they objected to being " shut out " by the company and were pressing for the retention of a special agreement on lay off pay. A management spokesman said that the question of what was to happen to this particular agreement was being discussed with union representatives. British Leyland began car assembly at its Longbridge. Birmingham, car plant yesterday for the first -time since December 21. Longbridge is being run on a " split " basis with some operations taking place in the first half of the week and others in the second.


Lofty England leaves Jaguar

The British motor industry will be poorer as a result of the fading from the scene of the former Lancaster bomber pilot and world famous racing mechanic, "Lofty" England, chairman of the Jaguar Division of British Leyland, who retires at the end of the month. England, whose nickname, reflecting his towering stature, could be heard throughout the pits at Le Mans, Reims, and Sebring during Jaguar's racing heydays of the late 1940s and 50s, sat in the top seat for less than two years of the company he joined as service manager in 1946. Last September, his job as chief executive went to Geoffrey Robinson, the 34-year-old head of British Leyland's Italian. subsidiary, Innocenti. With characteristic diplomacy, England, officially described by British Leyland as " one of the industry's most colourful personalities ", said today:

"Big developments are on the way for Jaguar and having worked with Geoffrey Robinson for the last few months I am hoping to retire in the knowledge that in him the company have a highly qualified chief executive who will lead the company successfully through these challenging years."

England, who is 62, has spent his working life' with cars. Always the enthusiast, he is the last, of the old Jaguar line, the men who steered the prestige company under the direction of its founder, Sir William Lyons, who retired in 1972. Both men were among the foremost supporters of the formation of BLMC. England's tact and ready wit should see him through his last job for British Leyland, representing the corporation in discussions with BL companies in some of its important overseas territories. : His decision to retire a few years early was not the result of any personality clash, he said.

"I get on very well with Geoffrey Robinson. The whole art of running a business properly is having someone to succeed you and then you get out of the way."

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January 11th 1974

Time to bend rules, Lord Stokes says

Lord Stokes, chairman of British Leyland, yesterday appealed to his 170,000 United Kingdom employees to work with management to pull the company through the worst crisis Britain had faced for nearly half a century. In an obvious reference to the recent militant statement by BLMC shop stewards he wrote in the group newspaper British Leyland Mirror:

"Everybody has to play a part and agree to a temporary bending of the rules. Some old customs and practices will have to go out of the window."

Despite the crisis, British Leyland would go ahead with the investment programme planned for the next five years, calling for capital expenditure of between £400m and £500m.


British Leyland is now facing a new challenge from shopfloor representatives in its 56 plants up and down the country. This follows demands by the unofficial, but powerful, BLMC shop stewards combine for full five day week earnings in spite of the fact that only three days a week are being worked.

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January 16th 1974

At Cowley, British Leyland's troubles are centred on a claim by 3,000 "indirect" workers, the men who provide essential back-up services for the assembly lines, that an agreement guaranteeing them four days full pay in each week should be honoured and retained throughout the power crisis. The Cowley plant has been allocated production on Thursdays, Fridays and Saturdays of each week and so far has arrangements to work 10 hour shifts on each of these days. After failure to agree on the four-day guarantee at a union/management meeting, the indirect workers yesterday voted to ban all overtime. In practice this would mean that Thursday and Friday shifts would be cut to eight hours and there could be no Saturday working. Because these workers do key jobs, including electrical work and supplying the assembly areas with components, all other production workers would have to be laid off.

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January 17th 1974

Leyland plea to drop overtime ban

By R. W. Shakespeare

As British Leyland's Austin-Morris car plant at Cowley, Oxford, begins its first vehicle production of the week today- the first of its "power on" days, about 3,000 key workers are being urged by management to attend a mass meeting to review an overtime ban, If the 3,000 "indirect" workers, the men who provide the essential back-up service for the assembly lines and production areas-go ahead with the ban, which was announced by their shop stewards earlier this week, it will reduce shifts from 10 hours to eight hours today and tomorrow, and rule out Saturday working. This will lead to a 16-hour week for 19,000 workers. Stewards representing the indirect workers are demanding that an agreement covering lay- off pay for four days in a week should be extended to cover every week that the power crisis regulations operate. The management has re-minded the men that this agreement has a limiting clause and can apply only once in any set of circumstances. However, it has offered the indirect workers the same lay-off pay arrangements as other workers in the Cowley complex. These give up to 80 per cent of 'normal rates for days when men are made idle. The problem at Cowley is that as in most other car plants the lay-off agreements have strict time limits. They cover only a specific number of days in each three-month period. And at Cowley, these agreements have now been exhausted for most workers. This means that if the three-day week continues after this weekend workers will only get paid for the time they are actually at work. British Leyland's car output has already been cut by about 40 per cent, because of the power restrictons. If the over- time ban goes ahead at Cowley, output there could be down to perhaps 25 per cent of normal levels. For all of the 19,000 workers it would mean pay packets containing only a fraction of normal earnings which are mostly around £50 for a basic 40 hours.

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January 19th 1974

Disputes halve output at BLMC Cowley works

By R. W. Shakespeare

Three-day week operations at British Leyland's Austin-Morris assembly plant at Cowley, Oxford. have been halved because of internal labour disputes. No vehicles were produced on the night shift last night and the assembly lines will be shut today, one of the plant's " power on " days under the emergency regulations. This means that 8,500 workers are idle, losing not only their normal pay rates but overtime premiums for weekend working. Part of yesterday's day shift at Cowley was also lost, and 4,000 assembly workers were sent home because of a new dispute involving 170 lorry drivers who walked out. The men demanded that they should revert to a normal five- day week of eight-hour shifts instead of the emergency three day working with overtime. There was one quite significant "straw in the wind " yesterday, when most of the 800 workers in the print shop signed a petition expressing "no confidence " in their shop stewards over the decision to call the overtime ban. The management has already made a personal approach to each of the 3,000 workers directly involved in the overtime ban decision, which follows a dispute over lay-off pay. The feeling among management officials was that a vote taken at a meeting of workers earlier this week, after which the stewards announced the ban did not represent the majority view on the shop floor.

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January 22nd 1974

BLMC to spread £3m in Turkey

British Leyland's associate company in Turkey, BMC Sanayi, is spending £3m to increase output of lorries, vans and tractors. It already dominates the Turkish commercial vehicle market, accounting for more than 50 per cent of all sales. Most of the money is going on a new foundry to remove a production bottleneck in engine castings. It will double the 8,370 vehicles sold in 1973. Manufacture of the Land-Rover, at the rate of 1,000 a year, will begin in March.

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January 30th 1974

British Leyland ends Cowley Saturday shifts

By R. W. Shakespeare

After the Government's announcement of changes in the three-day working week arrangements, British Leyland has ended troublesome and costly Saturday shift working for the 19,000 workers at its Austin-Morris car plant at Cowley, Oxford. The entire Cowley complex, including both the body pressing shops and the car assembly areas, will open this morning and work until Friday night. A big proportion of Cowley workers this week will suffer their first serious wage cuts since the crisis began. Their normal earnings of between £45 and £50 a week will be reduced by between £15 and £20. This is because agreements which gave them up to 80 per cent of normal rates for days when they were idle have now expired. They will be able to claim unemployment benefit for days when the plant is closed because of the power crisis.

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FEBRUARY 1974

AUTHI- The ADO16 Austin De Luxe launched in Spain. Fitted with a 998cc 55bhp "A" series engine, grille similar to that fitted to the Austin 1300.
AUSTIN MORRIS- Work begins on a revised Mini Clubman estate with a view to launching it at the 1976 UK Motor Show.
The battery was moved to the engine compartment and the entire rear floor structure, including the side storage boxes, was re-jigged to lower the rear seat. The body, meanwhile, was modified to have one-piece fixed glazing with extractor vents on the rear pillar, along with full width wraparound bumpers front and rear and a one piece lift up tailgate. One semi engineered prototype was built, but the project fizzled out in May 1975.

February 4th 1974

The National Union of Mineworkers vote to go on strike.


February 5th 1974

Leyland awaits 8-9 pc price verdict
By Clifford Webb
British Leyland, reported to be losing £3m a week because of the power crisis, have told their dealers they expect the Price Commission to approve increases on all their cars and commercial vehicles " very shortly now ". Dealers said last night they had been informed " unofficially " by company sales staff that the rise would be between 8 and 9 per cent. They expect a formal announcement within a week.

About 7,000 workers at British Leyland's Jaguar car plant at Coventry have voted to accept a pay agreement. It will mean the elimination of piecework and the introduction of a flat rate pay system.

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February 6th 1974

Lord Stokes, chairman of British Leyland, said yesterday that industry would face serious problems through the pits strike but the Government had nothing to be ashamed of. His company announced later that output of Morris Marinas at Cowley will be cut to a maximum of 4,250 a week because of labour and parts shortages and the expected drop in the home market. But while the three-day week continues, output of the model will be cut to 2,500 a week.

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February 7th 1974

Prime Minister Edward Heath calls a snap general election to be held on 28th February 1974.

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February 16th 1974

A strike by 1,400 engineering workers at British Leyland's Cowley, Oxford, car plant threatens widespread lay-offs among the 19,000-strong labour force. Production of Maxi saloons is already at a standstill and 600 men are laid off. The strikers claim they are losing £3 a week as a result of the switch from Saturday working, paid for at time-and-a-half rates to Wednesday working at normal rates. They are pressing the company to pay a guaranteed minimum of 34 hours while three-day working continues. The strikers, members of the Amalgamated Union of Engineering Workers, are responsible for all maintenance work There is to be a mass meeting on Tuesday. Cowley is not due to resume work until the night shift on that day.

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February 7th 1974

Prime Minister Edward Heath calls a snap general election to be held on 28th February 1974.

FIVE MORE years of OLD Labour's shambolic mismanagement ahead...

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February 28th 1974

The general election is held on this day, the only election since the Second World War not to produce an overall majority in the House of Commons for the winning party, instead producing a hung parliament. The incumbent Conservative government of Edward Heath polled the most votes by a small margin, but the Tories were overtaken in terms of Commons seats by Harold Wilson's Labour Party due to the decision by Ulster Unionist MPs not to take the Conservative whip. After failed negotiations between Heath and Liberal leader Jeremy Thorpe, Heath resigned and Wilson returned for his second spell as Prime Minister of the United Kingdom.

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MARCH 1974

AUSTIN MORRIS- Work finally ceases on the ADO74 supermini project .

March 1st 1974


Leyland to sell stake in Spain for £26.7m

By Our Financial Editor

In its largest single asset disposal to date, British Leyland is selling its Spanish car manufacturing business to General Motors for £26.7m in cash. British Leyland now owns 98.3 per cent of Automoviles de Turismo Hispano Ingleses. This has plants in Los Carrales, Pamplona and Sampedor and makes Mini and Victoria cars in Spain with a high degree of local content, including engines. Only a year ago British Leyland, whose involvement in Spain was inherited from the old British Motor Holdings business, increased its holding in AUTHI from 50 per cent to 97.2 per cent. It paid about £4m to Spanish investors for the extra 47.2 per cent. That same interest is now being valued at nearly £13m. Until just before Christmas when General Motors, the world's largest vehicle manufacturer, saw the AUTHI acquisition as a way into the Spanish market and approached British Leyland with the offer, British Leyland had firm intentions of expanding its Spanish interests. The deal, disclosed yesterday, is subject to Spanish Government approval and final sale and purchase agreements being signed between the two companies. It will allow British Leyland to continue marketing in Spain the Mini and Victoria cars which will be manufactured under contract by GM at existing AUTHI plants. Net assets of the AUTHI business are put at £17.6m, and latest published results up to the end of September last year show that the company was still losing money, a loss of £2.2m was reported for the 1972-73 period. For British Leyland, still going ahead with a five-year £500m spending programme of which £100m is earmarked for the current year, the £26.7m from AUTHI is undoubtedly a useful windfall. Although British Leyland had liquid assets of some £50m at the end of 1972-73, Mr John Barber, the corporation's managing director, admitted recently that liquidity had deteriorated since the year-end under the impact of the three-day week. Capital spending this year is likely to be concentrated on improvement and modernization of existing British plants rather than expansion.

A shrewd manoeuvre by British Leyland

From all angles the proposed deal between British Leyland and the American owned General Motors Corporation for the sale of BLMC's car assemnbly interests in Spain looks a wise move on the part of the British company. Not only does British Leyland free almost £27m of capital to pour into its huge expansion at home; it also maintains its hold in the booming Spanish car market with the agreement that GM continues to manufacture Mini and Victoria models. The latter is the Spanish version for the home market only of BLMC's 1100-1300 range. The big question in the motor industry last night, however, was for how long will GM's contract to assemble British Leyland cars in Spain operate ? The Americans were being particularly cautious and in London were saying only that the agreement had been reached in principle and that no details would be issued until the ink had dried on the contracts. It is clear, however, that GM which operates in Europe with its Vauxhall and Opel subsidiaries in England and Germany, would be delighted to establish a foothold in Spain. With its purchase of all British Leyland's shares in Automoviles de Turismo Hispano, S.A. (AUTHI) GM will be able to launch its own small car in Spain, possibly a version of one of the smaller Vauxhalls. British Leyland, on the other hand, will not miss the lost sales of the aging Victoria model, while a large proportion of the Spanish made Minis have been exported, particularly to countries like Switzerland and could be built elsewhere. Last night, British Leyland said that production of its cars in Spain would be dependent on GM's ability to " phase in an acceptable car " but that this would not be for a number of years. For British Leyland, the three AUTHI plants at Los Corrales, Pamplona and Sampedor, represent the smallest of its European operations. AUTHI last year produced 43,000 cars, of which 34,000 were for the home market. The year before it exported 6,000 Minis to Switzerland. British Leyland has had a controlling interest in the company since 1969 and bought 98-3 per cent of AUTHI last year. Because of the stringent Spatish regulations on car imports, the AUTHI cars have comprised almost 100 per cent locally manufactured components. GM will have to maintain the same type of operation, although the cars will be distributed by a wholly owned British Leyland sales company. With the Spanish car market booming-some observers estimate that Spain's car makers will be producing well over 1 million units a year by 1980. British Leyland could be gambling on the possibility of Spain relaxing its import regulations, which could reduce the need for big manufacturing facilities.


THE GUARDIAN

SALE OF BRITISH LEYLAND PLANT MAY HERALD GENERAL OUTLAY CUT
By Hazel Duffy

British Leyland announced yesterday it is selling its holding in the important Spanish market to General Motors, the American company. The sale raises £26.7 million for British Leyland at a time when the City believes the group is in need of cash to finance its expansion programme.
The British Leyland move is being interpreted in the City as the first positive warning that the short working week and the overall state of the economy will force large parts of industry to trim its capital expenditure programmes. Many large companies announced huge expansion plans last year when corporate profits were at a peak. But the pressures on cash flow induced by the change in the economic situation and accelerated by working below capacity will undoubtedly lead companies which already have high levels of borrowing to abandon part of thes programmes. This will effectively stifle the capital spending boom which Britain has been waiting for in the past four years, and the country could find itself in the midst of a capital spending recession by the middle of next year.
Spain is one of the world's fastest growing markets for cars and is also regarded as an important base from which to export to other parts of Europe. British Leyland had expressed its confidence in its Spanish subsidiary, which makes Mini and other saloon cars at three seperate plants, by incresing its share stake in the Spanish Authi company from 30 per cent to 97 per cent about a year ago. British Leyland cars will continue to be made in Spain by General Motors under contract, and these will be distributed by a British Leyland sales company. Mr John Barber, managing director of British Leyland, said yesterday :

"This is a mutually advantageous deal for General Motors and ourselves. It gives GM an entree into Spain with already existing plants and enables us to continue to build up increasing support for our dealer network through the new Leyland sales company."

British Leyland's five year expansion programme, announced last May, was thought to have included between £30 million and £40 million to be spent in Spain. The Authi subsidiary showed a loss of £2.2 million for the year that ended on September 30. The decision to sell out in Spain comes, however, at a time when other car manufacturers have been showing continued interest in the country.
British Leyland's plants in Britain are now working at more than 60 per cent capacity. Lord Stokes, chairman of the firm, said a couple of weeks ago that they could obviously not make profits at this level of production. Some analysts believe the group could be losing £10 million a month since the three day week has been in force, and that the liquid surplus of £31 million shown in the balance sheet at the end of September could have been wiped out by now.

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Nicholls1966,

I appreciate your efforts in bringing this to us, but how about some PARAGRAPH BREAKS please?

I thank you.

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March 6th 1974

The miners strike ends.

March 8th 1974

The normal working week is restored.

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March 8th 1974

Policy aims at smaller choice

The car companies involved in the British Leyland merger of January 1968,, provided between them the widest range of models of any motor manufacturer in Europe. But the advantage of being able to supply a car for every section of the market was outweighed in the early years of the new company by a host of problems which only now look like being brought under control: inadequate investment, outdated plant, inter-marque rivalries, and too many models that were either antiquated or superfluous. The formation of the British Leyland Motor Corporation brought together Triumph and Rover-separate entities until the mid-1960s when both carne under the Leyland Motors umbrella and the British Motor Corporation, the still somewhat uneasy alliance of Austin and Morris, to which Jaguar had been reluctantly added only 18 months before. Not only were there keen rivalries between these various companies but their models clearly overlapped: the top Rovers competed with Jaguar, the Rover and Triumph 2000 cars were in even more direct conflict, and the small Triumphs came up against the BMC range. To introduce some sense in to this jungle, Leyland split its car companies into two groups, forming a volume car division (Austin Morris) and a specialist division (Rover, Triumph and Jaguar). Since the key to the company's short-term survival was the health of its biggest component part, much of the money and effort during the first five years was devoted to the rationalization of Austin Morris.
Here Leyland had to perform a major rescue act. Not only were too many old and unprofitable models still being made but BMC had practically nothing in the pipeline. So the Morris Minor (which had been in production since 1948), the Morris Oxford, and Austin Cambridge and three-litre were swiftly phased out, leaving only the Issigonis front-wheel drive family of Mini, 1100 and 1800. Even the Mini and 1100, despite excellent sales, were making little money. The first priority was to fill the huge gap in the range between the 1100 and 1800. Leyland took over and brought to fruition yet another Issigonis design, for a roomy five-door car on the lines of the Renault 16, with particular appeal for the holidaymaker and weekend tripper. It was launched in 1969 as the Austin Maxi. The concept was sound enough, but the car suffered from a wretched gear change and the 1500cc engine lacked power. Within .18 months Leyland responded by offering a re-designed gearbox and a 1750 unit, and sales began to climb. Meanwhile Leyland had taken the significant step of temporarily abandoning its tradition of cars with advanced engineering to take on the Ford Cortina and Vauxhall Viva in the important fleet market (which accounts for more than one third of new car sales). The Morris Marina, which appeared in April 1971, was a totally conventional car and cheap to make, and it did much to revive Leyland's profitability. It offered a choice of 1300cc and 1800cc engines, a spacious interior and a huge boot. During 1973, it became the second most popular car in Britain after the Cortina. With the Marina successfuily established, Leyland could go back to advanced engineering. The Allegro, launched in May 1973, as the successor to the 1100, carried on the Issigonis tradition of front-wheel drive, transverse engine and all-independent suspension (a new system, Hydragas, replacing, though similar to, Hydrolastic). The Allegro used the engines from the 1100, 1300 and Maxi models, and had a new body shell which did not increase interior space but gave a much bigger boot and more room under the bonnet. People who had expected the flair of a Citroen GS were disappointed, but the Allegro won general favour. Leyland has high hopes of the Allegro in the European market, and another car for Europe, a bigger model, will follow towards the end of the year. This should complete the Austin Morris range for some time to come, with future developments likely to be less concerned with entirely new models than with variations on existing ones. The 15-year-old Mini, for instance, is due for a major face-lift during the next couple of years. It is difficult to see how the basic shape can be altered without abandoning the essence of the car, but there is scope for a more luxuriously equipped interior on the lines of the Cooper 1300 and Mini 1001 which Leyland makes for the Italian market. The Allegro may also follow the Italian line by offering up-rated twin-carburettor engines, and the Marina is likely to be developed on the Cortina principle with further engine and trim options.
Jaguar, with a long tradition of independence under the almost personal rule of its founder, Sir William Lyons, has probably fitted into the Leyland scheme with the least grace; and it has remained more or less a marque apart, though to end the overlap with Rover the 2.8 litre engine has been discontinued on the home market. (Could the energy crisis bring it-back again ?) The XJ saloons were planned before the Leyland takeover and the six cylinder appeared in the autumn of 1968 ; it was followed four years later by the superb 5.3 litre XJ12. Two-door coupe versions of the XJ range went into production this year, and a successor to the eight years old E type cannot be long delayed. Jaguar's major problem has not been the quality of its cars but making enough of them to satisfy demand; and energy crisis or not there should still' be enough customers when production reaches its projected 60,000 units a year, or double the 1973 figure.
Rover and Triumph were both profitable companies, so BLMC could afford to leave them alone in the early years while resources were concentrated on the volume car sector. Rover's projected mid-engined sports car was cancelled and the range pruned to the 2000/3500 series and the Land-Rover and Range Rover. Originally, BLMC planned to replace the competing 2000 models with a single basic car in Rover and Triumph versions; but during 1973 Rover and Triumph were brought under one management and given separate roles , Rover to produce medium- quality saloons, Triumph to concentrate on smaller, high performance saloons on BMW or Alfa Romeo lines. So the 2000 successor will be a Rover and it will be built at a new assembly plant at Solihull. The Triumph range, mean- while, continued to offer a variety of saloon and sports models, many of which in spite of judicious face-lifting were becoming increasingly out of date or superfluous. Plans were laid for a drastic rationalization that would eventually produce two basic models: a sports car, with a choice of engine sizes, and a performance saloon based on the excellent two litre Dolomite Sprint which was launched during 1973. Fewer models but many more of them is the policy. Leyland hopes to double the output of Rover Triumph to 460,000 in the next five vears. The continued success of the MG marque, particularlv overseas, suggests that it will continue, and there is to be a joint sports car programme involving MG and Triumph. Again there seems little sense in eventually continuing with competing models like the Midget and the Spitfire, though it is unlikeiv that MG will go the way of Wolseley and become merely a badge on a Triumph car.

[nicholls1966uk]

March 14th 1974

Mr John Barber, managing director of British Leyland, gave a warning today that a tough budget could reduce the United Kingdom car market this year to below one million units for the first time since 1962. Speaking from the Leyland stand at the Geneva Motor Show, he said that a policy of cutting home consumption-by, for instance, an increase in value added tax or car tax, would be short-sighted and do nothing to help the balance of payments. The industry needed a sound home base to maintain its exports. The fuel situation and petrol price rises had already cut demand for cars and, even if the budget did not bring in further restrictions, domestic sales were likely to be only 1.1 million compared with 1.7 million in 1973. Mr Barber predicted that with return to the five-day week, Leyland would continue to hold nearly 40 per cent of the British market and he did not see imports rising much above their present 22 per cent. On exports prospects he said:

"The whole European car market is down significantly an last year and things are going to be tougher for everybody. But I still think we shall sell all the cars we can make."

Leyland intended to go ahead with its £500m expansion programme and Mr Barber did not foresee a switch to smaller cars.

" But we have got to make our cars more economic. In the next five to 10 years there will be quite dramatic improvements in fuel consumption on cars like the Marina and the Allegro, even if performance has to be sacrificed."

The Allegro, launched by Leyland as a "car for Europe ", begins its attack on continental markets this week. It goes on sale first in Switzerland, Belgium and Holland and will have been introduced in all main European countries by the autumn.

[nicholls1966uk]

March 16th 1974

Treble pay lure for key U K car men in S Korea

By Clifford Webb senior motor industry engineers are being offered tax free salaries up to three times their present earnings to join Mr George Turnbull, the former managing director of British Leyland, who leaves for South Korea next month to establish that country's first motor industry. During the next two weeks full-page advertisements will appear in local newspapers serving motor manufacturing centres in Britain. In addition to huge salaries, chief engineers specializing in body, chassis, plant lay-out, development and tooling will be tempted by free cars, free western style housing, cheap household help, free travel back to Britain for four weeks' annual holiday and undisclosed but " substantial" fringe benefits. Biggest of these is tax-free concessions on earnings for approved foreigners working in South Korea. A spokesman for Mr Turnbull said yesterday:

"This is only the first phase of the recruiting campaign. After chief engineers we shall be looking for all the other key people necessary to start a motor industry from scratch."

[nicholls1966uk]

March 18th 1974

BLMC to restructure spare parts network By Clifford Webb

British Leyland is planning extensive reorganization of its £200m. a-year spare parts business. It includes fundamental changes for the whole of the 3,700-strong distributor dealer network and will almost certainly lead to tighter prices from its component suppliers. No official announcement has yet been made but it is understood that details of the first phase will be revealed to the trade in a few weeks' time. The decision to go ahead with the reorganization results from dramatic improvements which followed the integration of the corporation's specialist car parts operations.
Reliable sources report that in the past 18 months profits from the sale of Jaguar, Rover and Triumph parts have more than doubled. At the same time there has been a substantial improvement in the service offered by dealers. It is not without significance that the man responsible for this, Mr John Egan, a former General Motors employee, has been promoted to the key position of marketing director in the newly created Parts and KD Division. This now covers the corporation's world wide parts activities. Yesterday Mr Allen Sheppard, the division's managing director and himself a former Ford and Chrysler parts executive, said:

"I am not yet in a position to reveal details. I can say however that preliminary discussions have taken place with network representatives and their reactions are very favourable. We intend to take on more of the responsibility for organizing more of the distributors and dealers parts departments. It will mean more staff for the corporation and less for dealers but the end result will be more profit for both sides and a better service to motorists."

A reappraisal of the 180,000 different parts in the corporation's vast range is now being carried out with two aims in mind, to reduce the parts inventory and to renegotiate purchase prices. There is plenty of scope for improvement here. For instance, Renault, with roughly the same car production has only 60,000 parts in its range. The sale of parts is by far the biggest profit earner for motor manufacturers. As much as 70 per cent of the industry's profits come from this one source.
Component manufacturers traditionally sell parts for new vehicles (original equipment) at break-even prices, relying on the much higher prices which apply in the after-sales market for the bulk of their profits. But last night Mr Sheppard hinted at changes in this long established relationship between original equipment and after sales. He told Business News:

"There must be a re-balancing of the scales between original equipment and replacement parts. It may be that new cars will have to cost a little more to bring about sharper replacement prices. British Leyland has a lot of muscle to push this through. Until the Parts and KD Division was created five months ago we were not aware of our strength. If I tell you we must be responsible for £200m of parts sales worldwide you will realize what I mean."

He also intends to make it more difficult for the so-called pirate companies to manufacture copies of British Leyland parts.

"We are tightening up on copyright everywhere. All new parts are now automatically scrutinized ",
he said.

[nicholls1966uk]

March 21st 1974

Daniel Richmond, former BMC consultant and boss of Downton Engineering died on this day.



March 23rd 1974

There was no production yesterday at British Leyland's Rover engine factory at Acocks Green, Birmingham. About 800 workers walked out complaining about too frequent lay-offs resulting from a strike by inspectors at Alvis, Coventry. A Rover spokesman said the Alvis strikers had agreed to resume on Monday and it was hoped to make a full recall of men laid off.

[nicholls1966uk]

March 26th 1974

DAILY EXPRESS

£100 MILLION BLOW TO BRITISH LEYLAND

By Ray Heath

Britains biggest exporter and our only large-scale Independent car maker British Leyland lost production worth £100 million during the 12-week energy crisis. This has sent the group into the red in the first half of its trading year, and put a question mark on profits for the whole 12 months. During the go-slow, which also hammered many of Leyland's suppliers, vehicle production was down by 100,000. Chairman Lord Stokes told shareholders yesterday that the group had been operating at around 60% capacity during the miners dispute. No engineering company the size of British Leyland could expect to operate profitably at that level of output, he said. Leyland made £51 million last year but the chance of making any money at all this year is now in doubt

"If we get a fair run in the second half of the current year we should make good some of the earlier losses but it is not going to be easy, I believe it will take some time to get us fully back on course,"

said Lord Stokes.

He would not say how big the first half losses were, but his right hand man, John Barber said later : '" When you talk of heavy losses you do not mean £1 million."

The biggest worry at British Leyland now is the possibility of industrial action by engineering workers.

"It could have disastrous results which are bound to have repercussions throughout the motor industry," said Lord Stokes.

He also reported that the energy crisis cutback had left the way wide open for overseas competitors in export markets.



March 30th 1974

Marina line halted at Cowley for fourth day

By R. W. Shakespeare

Production of Marina cars at British Leyland's Cowley, Oxford, Plant was at a standstill yesterday for the fourth day running, with 1,200 assembly workers idle. The plant, which has a big backlog of orders, resulting from the three-day week, has lost output of some 3,000 cars worth more than £3m this week through a dispute over the use of industrial engineers to study ways of reducing manning scales and raising line speeds. British Leyland says these changes are needed to make the plant more productive and to increase output from 27 to 30 cars an hour. The management says they would simply involve " a fair day's work for a fair day's pay"' for Cowley workers. The carmaker is trying to settle the dispute in discussions with the unions and more talks are due next week. However, it now seems most unlikely Cowley can resume Marina production after the weekend. If the shut-down continues, more workers may be laid off.

At another British Leyland plant, Triumph at Liverpool, a second day's production of Toledo cars, together with body units for other Triumph models was lost yesterday. A group of 370 press shop operators are on strike there in a dispute between a shop steward and a supervisor.