News digest
Compiled by Clive Goldthorp
1) Jaguar - Land Rover (and Rover?)
Tata wants to launch Indica in UK
AutoWired/BBC News.co.uk 9th July, 2008
Indian car maker Tata intends to launch one of its best-selling
models, the Indica, in the UK, the BBC has learned. The car has been partially
designed at Tata's technical centre in Coventry. In 2003 an earlier version
of the Indian company's car was branded as CityRover by MG Rover but criticised
on the BBC's Top Gear programme.
Tata bought Jaguar and Land Rover, which employ about 16,000 staff
in the West Midlands and Merseyside, from Ford last month in a £1.7bn
deal. The Indica could go on sale in the UK next year, BBC Midlands Today understands.
The Indian car maker's managing director, Ravi Kant, said it has learnt from
the MG Rover experience over the car.
'Notice us'
Speaking to the BBC in India, he said: "We'll make sure that
this time we are far more careful about our plans in the UK." The current
model will be replaced in India in the next few weeks and it is the new version
which the company intends to launch in the UK.
Clive Hickman, who is one of the British engineers working in Coventry
and India, said: "It is a step change in the quality of the vehicles we've
been making in the past. Maybe that's something that will make people notice
us a little bit more."
An automotive analyst with Ernst and Young, Eric Wallbank, said
he believed British buyers would want an Indian car. He said: "People are
not particularly concerned about where the vehicles that they buy come from.
When Japanese cars first came here, people reacted quite negatively to those.
They got used to the idea. (It was) the same with Korean brands when they came
here."
[Editor’s Note: AROnline readers can view the following
BBC Midlands Today video clips by clicking on the links provided:
1) An
inside look at Tata
2) Tata
head interviewed by BBC
3) Tata's
Jaguar revamp plan
4) Tata
to make UK launch
Unfortunately, BBC Midlands Today's Transport Correspondent,
Peter Plisner, does not seem to have put “the Rover question” to
TML’s MD, Ravi Kant…..]
2) SAIC Motor/MG and Roewe
Battle over MG badge shifts up a gear
Megan Murphy, Law Courts Correspondent, The Financial Times 5th July, 2008
A descendant of an English motoring dynasty is taking on China’s
largest carmaker in a battle over one of Britain’s iconic brands –
the MG sportscar. At stake are two separate plans to relaunch the historic badge
in the UK following the high-profile collapse of MG Rover in 2005.
The Shanghai Automotive Industry Corporation, the Chinese manufacturer
that acquired the MG assets through a merger last year, has invested tens of
millions of pounds in restarting production at the former MG Rover factory in
Longbridge, Birmingham. It has brought workers – and hope – back
to a plant that lost more than 6,000 jobs when MG Rover went bankrupt.
SAIC’s debut model, the two-seater MG TF roadster, is expected
to be delivered to UK showrooms in September. A hitch has emerged, however,
in the form of William Riley, a motoring enthusiast and descendant of the founders
of the famous Riley car marque. Mr Riley claims that he owns the rights to produce
the MG X Power, a limited edition handmade racing coupe that has an £85,000
($168,000) price tag.
The dispute, which has rumbled on quietly for the past year, has
recently shifted up a gear. Mr Riley has tried to revoke 32 other MG trademarks
held by Nanjing Automotive Corporation, which merged with SAIC in 2007. Now
the UK Intellectual Property Office is being asked to weigh in on who owns the
rights to the MG name in the UK.
It is not the first time the brand’s Chinese owners have
been hit with a trademark claim. In 2006 the administrators of MG Rover’s
Dutch subsidiary raised concerns about their right to use the MG marque in Europe.
That issue has since been settled amicably. NAC bought MG’s assets for
£53m in 2005 and shipped most of its plant to Nanjing in eastern China.
It has since embarked on an ambitious plan to launch the brand not just in Europe,
where the car has long had a passionate following, but also in China.
The TF two-seater is expected to retail for £16,400 in the
UK through a network of about 50 dealers. Some 300 orders have been taken for
a limited edition launch model. Mr Riley’s X-Power, by contrast, is put
together from thousands of leftover parts and a chassis that he imported from
Italy. He acquired the parts in 2007 from the administrators of one of the companies
in the MG Rover Group.
The carbon-bodied supercar has a 540bhp Ford V8 engine and an estimated
top speed of more than 200mph. Mr Riley wants to produce five or six cars per
month, he says, aimed at British motoring enthusiasts. There is scepticism in
the market about whether he can set up an operation that will produce that many
units a year.
“This is my lifelong passion,” he said this week. A
Toronto-based stockbroker has placed the first order for a bespoke £87,000
version of the X-Power, according to Mr Riley. The question is whether there
will be an MG badge on it. Mr Riley contends that he legally acquired the intellectual
property rights to the MG X-Power from PwC, the liquidators of MG Sports &
Racing, and is entitled to use the name. His cars would carry a silver and green
MG X-Power logo, as opposed to the brown and white of the classic MG badge.
That does not sit well with the Chinese, who claim that any and
all XPower trademarks had been transferred to NAC long before Mr Riley came
into the picture. They say his asset sale agreement specifies that buying the
XPower parts did not confer any licence to use the words MG or Rover. NAC says
it intends to defend its right to the brand vigorously.
Until a settlement, or a decision by the Intellectual Property
Office, consumers who have waited more than three years to get their hands on
an MG may have two very different choices.
3) MINI
Mini helps BMW buck the trend in car sales
John Cranage, Automotive Correspondent, Birmingham Post 8th July 2008
Booming demand for Oxford-built Minis helped BMW buck falling markets
and increase sales five per cent in the first half. The Munich-based premium
carmaker, whose brands include Rolls-Royce, was up despite a dip in June, figures
yesterday showed. Among the highlights was the sale of the millionth BMW 3 Series,
the group’s biggest seller.
Sales rose 4.7 per cent to 764,874 units, making it the most successful
first half BMW has ever had. However, the company was not entirely able to avoid
the difficult economic trends in markets such as the USA and Japan and saw sales
slip 2.8 per cent to 146,138 units in June. Mini was the group’s saving
grace in the increasingly bombed out US market last month. With American drivers
turning their backs on fuel-thirsty SUVs and pickup trucks, Mini sales rose
by 25 per cent to 5211, outselling the Hummer, the biggest SUV of all, by about
two to one.
Year to date figures for the US showed that Mini was 34 per cent
ahead at 26,400 units. With stocks of the iconic little car running low, the
Oxford plant is working to fulfil US orders up to September. Such a high level
of demand is leading to speculation that with the Oxford plant now operating
at, or near, full capacity, a second Mini assembly site may be on the cards.
“The last three months have been the best in our history
as the significant structural shift to small cars has brought into our dealerships
a diverse range of vehicle owners that currently drive large cars, SUVs and
trucks,” said Jim McDowell, vice-president of Mini USA.
Commenting first half group sales, BMW sales and marketing director
Ian Robertson said: “In the first half of the year we were able to report
solid growth, as planned. Despite difficult economic conditions in certain automobile
markets, the BMW Group aims to improve on last year’s sales level for
the year as a whole. However, we will continue to monitor world markets and
their performance so as to react as necessary.”
Deliveries of the BMW brand were up 2.4 per cent between January
and June to 637,569 vehicles, driven mainly by demand for the 1-Series. Global
sales of Mini grew by 17.9 per cent to reach a total of 126,810 vehicles, helped
by demand for the Clubman model.
Launched last November as the third model in the line-up, Clubman
now accounts for every fifth Mini sold. Rolls-Royce Motor Cars delivered 495
super-luxury Phantoms to customers in the first half of the year, an increase
of 68.4 per cent over the same period in 2007. June deliveries rose by 56.2
per cent to 114 vehicles.
BMW’s motorcycle division was unable to maintain last year’s
level in the first half of the year. Sales fell by 5.6 per cent to 55,932 units
while in June the company sold six per cent fewer two-wheelers. BMW’s
sales performance is in contrast to its revenues and profits, which have dipped
recently in the teeth of rising raw material costs and the global credit crunch.
Fiat, BMW plan small-car alliance
Luca Ciferri, Automotive News Europe 8th July, 2008
TURIN -- Fiat and BMW today said they plan to cooperate on platforms
and components. BMW brand development head Friedrich Eichiner said in a statement:
"We are currently examining with Fiat group possibilities for the joint
use of components and systems in Mini and Alfa Romeo vehicles."
The automakers have agreed not to divulge more details of the possible
collaboration, a BMW statement said. Supplier sources told Automotive News Europe
that the companies will develop a joint platform that will underpin the next
Fiat Grande Punto, BMW's third-generation Mini and the next-generation Alfa
Romeo MiTo. The two companies are considering developing a new family of gasoline
and diesel engines, industry sources told ANE.
The BMW statement said Eichiner and Alfredo Altavilla, Fiat's head
of business development, have signed a memorandum of understanding to cooperate
on architectures and components. BMW said cooperating with Fiat will help it
achieve economies of scale and cost reductions as part of its Number One strategy.
It said the results of its discussions with Fiat will be known by the end of
the year.
Fiat Group CEO Sergio Marchionne said: "The proposed cooperation
with BMW is a significant cornerstone of our strategy of alliances." Fiat
already has industrial alliances with other carmakers including PSA/Peugeot-Citroen,
Suzuki and Tata. BMW cooperates in Europe with PSA on engine production and
the company has a joint venture in China with Brilliance.
Automakers increasingly are cooperating with competitors to reduce
investments costs for new models.
BMW to help Alfa Romeo in North America
Luca Ciferri, Automotive News Europe 9th July, 2008
TURIN, Italy -- Fiat said today that BMW will provide support in
launching Alfa Romeo in North America. "Mini US dealers would have the
possibility to also sell Alfa Romeo cars," a Fiat spokesman told Automotive
News Europe today. Fiat and BMW issued a joint press release announcing that
they have signed an agreement for possible co-operation on components and architectures
for their Mini and Alfa Romeo vehicles.
Fiat's version of the joint statement also says that "as part
of possible cooperation, BMW Group will provide Fiat Group Automobiles with
support in launching the Alfa Romeo brand in the North American market."
Alfa Romeo plans to return to the United States in 2010. The first U.S. model
is expected to be an entry-level premium five-door hatchback, code-named project
940.
The new car will debut in Europe late next year, replacing the
Alfa 147.
BMW not planning to hike Mini output
Richard Truett, Automotive News Europe 9th July, 2008
DETROIT -- There is no relief in sight for Mini dealers who are
short on inventory. Despite high demand and record sales for the small, fuel-saving
hatchback, BMW is unlikely to approve an increase in production for the United
States in the near term, said Tom Kowaleski, BMW's North American vice president
of corporate communications.
Demand for the stylish subcompact has risen this year with the
price of gasoline. That has left Mini dealers with just 1,051 cars in inventory
as of July 1 -- or a five-day supply. For the first half of 2008, sales of the
Mini Cooper are up 33.6 percent to a record 26,400, compared with 19,759 vehicles
sold during the same period of 2007.
Kowaleski said Mini marketing officials are working on a new US
forecast to gauge long-term demand before lobbying BMW to increase production
at the car's sole plant in Oxford, England. "Increased capacity equals
cost. It comes down to the accuracy of forecasting," he said. Because the
Mini plant is running at full capacity, a production increase would mean an
expensive expansion of the plant, a move BMW is not yet ready to make.
Kowaleski also said prices of the 2009 models are being reviewed
in light of higher commodities costs and the weak US dollar. "Discussions
are under way to determine what the price should be," he said. A number
of automakers have already announced price increases to cover higher costs.
BMW builds electric Mini for California
Bettina Mayer, Automotive News Europe 9th July, 2008
MUNICH -- BMW plans to export nearly 500 electric versions of its
Mini car to California, company sources said. The electric Minis are being built
at the Mini factory in Oxford, England, without engines, gearboxes or fuel tanks,
then shipped to Munich, Germany, where they are being fitted with electric powertrains.
BMW sources told Automotive News Europe that 490 of the Minis will
be leased to selected customers in California and 10 will be used as show cars.
The electric Minis are painted silver and have yellow roofs, the sources said.
BMW engineers working on the electric Minis are part of a new division called
Project i established by the automaker to develop low-emission city cars. The
electric Minis will help BMW to meet new California regulations that will require
carmakers selling cars in the state to offer zero emission vehicles.
Mini spokesman Cypselus von Frankenberg did not confirm that BMW
is building electric Minis. "BMW will announce whether it will build electric
vehicles or not later this year," he told ANE. Other carmakers are developing
electric cars. Volkswagen, Daimler, PSA/Peugeot-Citroen and Renault have all
announced electric-vehicle programs in recent months, joining several U.S. and
Japanese automakers that are working on the technology.
BMW and Fiat groups to collaborate
just-auto.com 9th July, 2008
Future Mini and Alfa Romeo sharing 'under the skin' architecture
and parts and BMW helping Alfa re-launch in North America are two likely outcomes
of the latest auto industry collaboration. BMW Group and Fiat Group Automobiles
(FGA) on Wednesday confirmed earlier media reports they were considering co-operating
on architectures and components for Mini and Alfa Romeo models.
A memorandum of understanding has been signed by Friedrich Eichiner,
BMW's head of corporate and brand development, and Alfredo Altavilla, FGA business
development head and CEO of Fiat Powertrain Technologies. "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," Eichiner 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," Sergio Marchionne,
CEO of Fiat Group and FGA, said. Statements from both Fiat and BMW said neither
automaker would provide more details of the possible collaboration for now.
They expect to complete cooperation discussions by the end of the year. This
was confirmed by a BMW GB corporate affairs spokeswoman who said talks were
only at a very early stage.
Fiat's version of the joint statement said it was possible BMW
would help FGA [re]launch Alfa Romeo in North America. Earlier, suppliers told
Automotive News Europe (ANE) that the two companies were working on a new platform
for the next Grande Punto as well as the third generation Mini, which is due
to go into production at Oxford, UK, early in the next decade. ANE added that
the two carmakers are also jointly developing a new family of petrol and diesel
engines.
Fiat has alliances with other carmakers including PSA/Peugeot-Citroen,
Ford (the 500 and a new Ford small car replacing the Ka will share architecture),
Suzuki and Tata while BMW works with PSA on engine production for the Mini and
has a joint venture in China with Brilliance that builds BMW cars there.
BMW did not immediately return calls seeking comment.
4) China Watch
Chinese automakers should stay away from Volvo Cars
Yang Jian, Automotive News China 8th July, 2008
SHANGHAI -- Lately, rumors and some media are saying that Ford
Motor has contacted some Chinese automakers for the sale of Volvo Cars. It is
hard to tell how much truth they contain. But one thing is clear: given their
scant experience in operating in mature markets, Chinese automakers are far
from ready to take over Volvo Cars.
Leveraging government support, China's major state-owned automakers,
such as Shanghai Automotive Industry Corp. and First Automotive Works, can easily
borrow from state-controlled banks to finance an acquisition of Volvo. But if
history is any guide, they should refrain from doing so. In July 2005, Nanjing
Automobile Corp., also a state-owned company, borrowed heavily from domestic
banks to fund its acquisition of the historic British brand MG. The project
failed and Nanjing Auto was later merged into SAIC.
Chery Automobile Co. is one of China's up and coming automakers.
But it is accepting significant help from Chrysler LLC to improve its manufacturing.
The partners are preparing cars for export that will be sold with a Chrysler
LLC brand. For SAIC, SsangYong Motor Co., a Korean automaker it bought in early
2005, remains a big headache even today.
SsangYong's workers went on strike in late 2005 protesting against
SAIC's plan to produce SsangYong's cars in China. After regaining profitability
in 2007, SsangYong slid back into the red at the beginning of 2008. SAIC, FAW
and Dongfeng are all the earliest state-owned enterprises in China and they
are still learning to operate as market-driven businesses. Compared with SAIC,
FAW and Dongfeng have even less experience in operating overseas, let alone
managing the sophisticated operations of a global player such as Volvo Cars.
A friend of mine at SAIC scoffed at a media report claiming that
Ford has talked to both SAIC and Dongfeng on the sale of Volvo Cars. She says:
"SAIC certainly won't consider buying it since we know how much hassle
an overseas acquisition could create."
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