GETTING IN UNDER THE JAG
Shares in the Midlands two ace car specialists bear an uncanny resemblance to the cars they traditionally make. Jaguars are glamorous stocks, high-powered and fashionable, while Rover, as an investment , is solid, dependable , a but dull. But the £2 million rights issue whose details were announced last week is the next financial injection in a long-cherished master plan to put more horsepower into Rover. As chairman Mr L. G. T. Farmer explains , ” We want to prove that we don’t just make old men’s motor-cars. ”
The trouble is that Rover doesn’t make enough cars for anybody . For every one car . Farmer’s men turn out roughly two Land-Rovers wonderful for bread and butter ; they are less good for jam. Over at Jaguar , Sir William Lyons turns out fewer vehicles than Rover. Yet he makes more cars ; in his last financial year , Lyons earned as much profit (to the nearest £295) as Rover did. For five years Rover has been working on its counter-stroke , the sporty 2000, aimed , says Farmer , at ” getting In under the lower-priced Jag” , a niche in the market. ”
If the plan works, the 2000 will have an even more dr amatic effect on Rover’s profits than on its image. Farmer is a down-to-earth accountant of 55 , with an unexpected, quick grin. As president of the Society of Motor Manufacturers and Traders , Farmer has the most baronial pied-a-terre in Londonâ€”a vast, ornate office in Forbes House, the Belgravia mansion where the great Diaghilev exhibition was staged , and which is thronged with cheerful motor magnates these days.
The Rover 2000 has arrived right in the middle of their industry’s boom. So has the Triumph 2000, another, but cheaper , car for the young, up-and-coming executive and one that is not too unlike the Rover. Farmer insists that the resemblance is only skin-deep – ” They ‘re different animals. ”
His 2000, at any rate, has caught on well enough to make one thing clear : ” For the next 18 months , our problem is making, not selling,”
This implies that the days of the 95s and 110s are numbered. Rover will want to recoup its £10.6 million investment in the 2000 as fast as possible. Older up-and coming executives can buy the 3-litre , and Farmer is ” happier about the 3-litre than I’ve ever been. ” He wasn’t happy once. The car was put into production too early and ” it took time to put that right. ”
A specialist company lives on its reputation for quality, and Farmer is determined not to repeat the mistake with the 2000. Rover’s life-and-death does not depend on its new car alone. But failure in a project like this ” sets you back on your ears.”
The 2000 was conceived as ” a car that’s good for Europe ” as well as one that had to be very, very good for Rover. Its maximum production rate is 25,000 a year, drastically improving the ratio of cars to Land-Rovers. Rover has been turning out a steady 40,000-pIus vehicles annually. The bread-and-butter earner is not being neglected. Farmer will spend some of the proceeds of his £2 million issue to raise output of his inimitable buggy. For an accountant with millions at stake, he is superbly unruffled.