The Great Motor Men : Part Three – Sir Michael Edwardes

AROnline contributor Martyn Kelham has produced this series on the great motoring men. Here, in third part, he discusses the Sir Michael Edwardes, the man who could have saved British Leyland…

Michael Edwardes

I was shocked to discover that Wikipedia just manage to list him right at the bottom of its ‘Michael Edwardes listing’ – after mentioning umpteen people to do with football (whatever that is) and music. Unfortunately, none of us can just ring him up and have a chat – as he sadly died towards the end of last year.

All our heroes are flawed. They must be because we are all human and we all make mistakes. No doubt every great industrialist can look back on their time and think – ‘damn, I wish I hadn’t done that’. I expect Michael could have done that too.

For us enthusiasts on this website – we all know he was a South African businessman who was with Chloride and then got offered the job of sorting out British Leyland. We are probably all familiar with the fact that Michael sacked Derek Robinson – the man who had orchestrated (with others) around 500 stoppages, and cost British Leyland about £200m in lost production. It has been argued that Robinson and his compatriots ruined the legitimate power and purpose of the unions in the UK – and they have never recovered.

Picking up the Ryder plan

He had ‘inherited’ the results of the Ryder Report – a plan that ignored the world situation and insisted that British Leyland could just go on expanding and producing ever more vehicles in a growing market – which, in reality, it wasn’t. Worse, the company had developed its own 1978 Corporate Plan based on the Ryder findings – so the rot was deeply engrained. Somehow, Michael had to ‘tone it down’ and get some realism into the picture. He’d inherited not only umpteen ‘in-house’ models competing with umpteen other ‘in-house’ models – but whole companies whose product range was not ‘doing the business’ – Triumph for a start. (Apologies to Triumph devotees – just based on the balance sheet!)

Michael drove the need for his planners to look at the bigger picture – to be critical of what was ‘the norm’ – and to think out of the box. They had to get to grips with too many factories that were not performing well enough and a public that was heartily fed up with the companies’ offerings – with some exceptions.

He was faced with a massive Rover factory in Solihull that production of the SD1 was never going to fill – and which had been a significant investment just a few years previously. Another problem, (which, to be honest a child could have worked out), was that bodies were sent all over the place for finishing or mating up with their mechanical components. Some of this was caused by the Government having insisted on new factories being built in under-developed areas that needed the investment and work. Unfortunately, some were miles from linked operations within British Leyland and would serve to give any accountant a nervous breakdown.

Evaluating the management team

Very shortly after arriving at British Leyland, Michael introduced psychological assessments and once the ‘nonsense’ about how these were conducted had been erased – these assessments significantly improved the chances of fitting the right manager into the right job – by about 40%! He also found a number of former Ford men about the place – and, with a few exceptions, most were not a good ‘fit’. Interestingly, the writer meets weekly with a man who was at British Leyland with Michael. I asked him about the integration of the Ford philosophy. He made it clear that these guys were only interested in ‘cutting back’ on everything and ‘cheapening’ everything. He is in no doubt that these Ford men did not sit well with the British Leyland operation – not because British Leyland people didn’t want to learn how to do it better, but that it was proven time and again, that the Ford way wasn’t better!

For Michael – quality was a real issue. He had to somehow get cars that looked good in the showroom to actually work well – and not fall apart or break down. In various contemporary writings he made this point very forcibly.

The saving grace within some of the management changes that Michael instigated was the commitment showed by Alex Park and others – top managers who would become on-board with the new direction – and work long hours to secure the future of the company.

Getting Gaydon off the ground

A new technology centre and test track was urgently required. British Leyland were hiring one and this in itself lead to restricted hours of road testing – and that directly affected the quality and durability of the cars.

In 1978, Michael approved a massive spending spree at Solihull to enable more Range Rovers to be built. The waiting list was seen as a positive – it meant people were queuing up to buy British. Michael had to get over to the guys that many didn’t wait – and sales were lost.

In the view of the new Board, the commercial vehicles sector was in desperate need of around £1,000 million for restructuring and, whilst talks were going on about this, strikes continued to strangle production and amplify the problems. Initiatives to improve were needed on all sides – even in the showrooms. The British Leyland nameplate was a disgrace – it had no loyalty value, no history, no image (other than, arguably – bad). Michael re-introduced Austin, Morris, Triumph and Rover – and, of course, kept Jaguar.

Sir Michael, the risk taker

What he also demonstrated on more than one occasion was a penchant for real risk-taking. He had a habit of speaking to workers and or Shop Stewards in large gatherings and then asking them to vote – then and there – for whether they were going to work with him or not. In almost all cases he won his point – in one memorable case by 715 to 5 when at the start of the meeting the consensus was the other way around. He was an outstanding speaker.

Michael will always be remembered for the ‘Speke Closure’. This plant was a controversial point from day one of Michael’s tenure. The factory went on strike on the very first day he took over the reins. It had over 2000 employees and was building the Triumph TR7 sports car. News was released (erroneously) that he had already decided to close it – news which was highly successful at gaining Michael thousands of enemies at a stroke – such was the ‘canniness’ of the ‘instigators of havoc’. In fact, he had made no such decision at that point – how could he so soon? What executive would make such a decision within hours of an appointment and without knowing anything of the individual plant or its problems?

Almost two years after his appointment, he and the Board had to make one of the hardest decisions of their industrial career. When it is necessary to cut through the romanticism, the loyalty, the job losses and the enormity of closing a plant of this size – the management has to have ‘balls’. The easiest thing in the world is to ‘fudge’ it – to talk of ‘ future development’ and ‘coming on stream next year’ – and all the other buzzword phraseology that lets ailing factories off the hook – at least for a time.

Speke’s lasting legacy

In Speke’s case – the finances could not support continuation – end of… Apart from massive over capacity across the cars operations, the industrial relations record at Speke did nothing to convince the Board that a rosy future was imminent. As most of us are aware – production of the TR7 was moved to Canley. The Board were flying in the face of a lot of public opinion, union representation, managers, stalwart members of the Board itself – and Michael Heseltine – the opposition spokesman on the environment.

In the end, the plant closed peaceably. (Relatively!)

The company at this time suffered some serious setbacks from militant union activities. Some of these were quite inexplicable. Having invested over £20m in modernising the Bathgate factory (for example), the employees saw the opportunity to demand a rise – for using the new equipment! This was not the first or last time that British Leyland would invest heavily in a plant – and then the workforce want more money for doing less.

Frustrations dealing with unions

At Pressed Steel in Swindon, the writer’s father was at one time, the Final Inspector on the Barb (Triumph 2000). He put in the ‘suggestion box’ that a guy on his line should stop drilling two holes in the Barb boot lid – because the badge that required them was no longer fitted. Further down the line, another guy welded up the two holes! Dad’s suggestion was adopted by management – which resulted in a three-week strike! Any cursory study of the times will provide enough examples of such stupidity to fill pages of this article – so I’ll refrain from doing so. As a long-time manager of people and projects, the writer can only imagine the frustration of dealing with such idiocy.

One of the most challenging periods for Michael and the Board was developing and implementing the Recovery Plan. Derek Robinson was a thorn in the side throughout this initiative. Once dismissed – a massive strike ensued (although about a thousand men broke the picket line and went to work) look. This strike was enacted a very short time after a considerable vote of confidence in the Recovery Plan – and various shows of determination by the workforce, to make the Plan work.

Michael made it known to the unions, that their members would need to come back to work quickly – or they will be considered to have dismissed themselves. The company would then re-employ whom they thought fit. It was a hell of gamble but, as so many of his gambles did – paid off. The men returned to work. In this one paragraph is hidden an untold anxiety for the Board, considerable nail-biting on behalf of the management and huge decisions for the employees. Taken in isolation, this does not seem too onerous, but Michael, his Board and his team worked through crisis after crisis – almost always to do with a loss of revenue through strikes or the lack of money to undertake the next phase to make the company viable. Although not unusual in industry and not necessarily commanding sympathy, the commitment from ‘the guys at the top’ often gets overlooked. Meetings going on well into the small hours was not unusual, family gatherings, anniversaries or weekends away, were side-lined for important meetings. The stress placed upon the team was handled as best they could – and some were good at managing it – others were not.

Introducing the Metro, courting Honda

Michael drove the ADO88 project (Metro) through to its launch – and it was a very successful car – although allowed, as so many BL cars were, to get too long in the tooth before discontinuation or upgrading – but that was after Michael’s departure.

It became clear that the company had to join forces to survive. Ford and GM were massive and were benefiting from a limited number of chassis, but an extensive range of versions in order to achieve more efficient production – especially in terms of locations was another huge benefit for them. Johnny Foreigner was hitting harder than ever before.

A partner was sought. Chrysler, Renault, Iveco, DeLorean and finally Honda were considered – all went to ‘early talks’. As we know, only the Honda option worked out. In May 1979, the Conservative Party entered Government and the company had a new Prime Minister to deal with. The dynamics changed somewhat from being part of a Government that (in part anyway) wanted to be involved – to one that absolutely did not. Despite this, by persuasive argument, Michael got £300m he was after in order to keep going.

Battling with economics

In the 10 years to 1979, wages had risen in the UK by just over 300% – but productivity was up less than 30%! These were extraordinary times. The writer purchased a house for £3000 in January (and never did a thing to it) – and sold it for £6000 in November. Imagine that today…

When Michael went to the Government for a further £990m – he had a concerned letter from Spike Milligan. He was worried that it was a lot of money but asked Michael if he could have some of it. Michael returned an explanatory and humorous letter – with a ‘fiver’. Ever after, Spike invited him to dinners at his home – and invariably sent a pound note back!

Michael and ‘Maggie’ agreed on little – other than that no Government should ideally have a large stake in a car company. He always wanted to be ‘under the Government’ for three years or less.

Edwardes – the gamechanger

I’ll lay my cards on the table. I think Michael Edwardes handled the unions and the situation within British Leyland brilliantly. But, I am an MG man (as well as a ‘Wolseley man’) and I think Abingdon should have been retained to develop and produce a lower-volume high quality sports car – but then, what do I know?

The sign of a great leader can be ‘when to quit’. Michael believed that, by 1982, his presence could be seen as detraction from the good stuff that was going on. The tabloid press were more than happy to headline ‘Edwardes pays 3%’ and so on. As so often happens in the press – the golden boy becomes the subject of ridicule – if it sells more papers. His name was synonymous with so many ‘tough line’ decisions and his face was photographed, sketched and became a cartoon image almost every day.

He had come in 1977 – fulfilled his five-year contract – and left in 1982. He left British Leyland in a much stronger place than where he found it – to argue against that would be as illogical as saying World War 2 didn’t happen. It’s a great pity therefore that less than 25 years later – the whole thing fell apart – having first been hived off to a plane maker, then the Germans and then, well…

No, don’t get me going!

19 Comments

  1. I have to say the issues on the Barb line were probably similar across the industry, with own father recalling similar tales at Ford.

    As per previous quotes from BL staff on this site, Edwards was concerned about quality, unions and efficiency, which were needed within BL, but he didn’t concentrate on what the future model programme enough (Spen King for one. I think said this in his interview with Keith).

    He concentrated on the Metro, but in reality the M cars was what should have been done first. The Allegro, Princess and Maxi werent flying off the shelves and these were the money makers. The Marina was selling well, but it was an antiquated product by then. The mini was still selling well at the time, and although old and still not totally competitive against the new crop of superminis, it didnt make the cash needed to create the future cars.

    If the M cars had been invested in first, with quality build in say 79, the public may have come back to the BL table and the Metro development could have been paid for without government top ups, leaving the company in a stronger position and less reliant on Honda, becoming more of an equal partner.

    • In fairness Edwards was aware of this, as he recorded in his memoirs, the problem he needed a new product to get the support of the treasury, and the LC10/11 were not still years away and the only new product with any maturity was the Ado88. Unfortunately as development had been stop / go on New product as the Government drip feed money it still needed a lot of work which pushed the LC10/11 back.

      • I get the point that the Metro was sort of their, but in 1977 everything was frozen by Edwards and it was in 78 that the Metro was started on again. However it took just over three years to develop the Maestro, with the first running LC10 prototype appearing in 78. Along with the confirmation by Kev, the former PSF engineer that the base is just modified Allegro, I still think sorting the mid range cars would have made more sense, and would have made a better business plan to sell to the government, and could have appeared earlier.

    • I agree with Daveh, the Maestro and Montego should have come first as the Allegro wasn’t selling in big numbers and had a terrible image, and the Maxi and Marina were becoming old. The Princess could have also been ditched by 1981 as it would have become superfluous to the Montego. Had the Maestro and Montego been launched in 1980 with the same sort of commitment to quality that occured in the early days of the Metro, and the engines been fully developed, they could have been a big success that could have paid for a more up to date Metro to appear in 1982 with better engines and transmissions.
      I often wonder if the M cars had been built properly from the start and the whole range launched by 1982 that Leyland could have recovered and rivalled Ford again. Such a profitable range of cars might have avoided the break up of the company that occured later in the decade and Leyland could still be around now producing everything from city cars to double decker buses.

      • Of course.

        But if we suspend reality long enough to imagine a BL which in 1977 was given the money and had the engineering resources to bring the Ado88 to market and develop the LC10/11 which at that date was little more than a paper exercise in “what if we build a Golf” all done and dusted (and better done than in reality) by 1982. We still have one big problem.

        The failure of the Allegro to retain the presence in export markets, principally in the European market, meant that the BMC foreign sales network no longer existed. For this reason, BL would not have the market presence to sell the M Cars in sufficient in volume to be able to sell them at a price / profit margin to compete with other major manufacturers in the European market. They were as Margaret Thatcher describes them when writing in her diaries about the funding of the LC10/11 (which she pushed passed the Treasury) a high cost manufacturer with a low quality product.

        What we forget that in the 70s & 80s, the UK had relative to the rest of Europe higher car prices (due to the higher taxes in much of Europe on the purchase of new cars), this was accepted by the UK Government as it suited BL, as the UK was the only market they had any significant market share and or volume. However had they tried to fight Ford in a price war, Ford could bring the Escort to the UK market with still a viable margin at a price BL could only dream pricing the Maestro at.

        • British Leyland still had a considerable presence in Italy, France, Ireland and Portugal, a combined market of 120 million, and had the Maestro and Montego succeeded in these markets, they could have rebuilt their dealer networks in other European countries.

          • It might have looked considerable when viewed from the BL position of virtually nothing else but we have to put it in perspective of what BL volumes were compared with their competitors.

            The Metro, in its long production run, less than 1.5 million units were built and this was the car that gave them what you call the “considerable” presence they had in Italy, France and Portugal in the 80s.

            However when you compare that with Peugeot 205 with its 5,2 million units and Fiat Uno with 6,3 million units built in Italy alone and a further 2,3 million units built outside Italy, you see what having a presence in the market really means.

            Even comparing the Maestro with the parts bin lash up by Talbot that was the Peugeot 309, we find the Maestro only accounting for 0,61 million units and the 309 weighing in with 1,63 million units you start to see how far BL was from being a major European Manufacturer.

            I think the comparison with the 309 is interesting, because despite its many virtues, it was not one of Peugeots core products, yet still with the weight of the PSA dealer network behind it, it cleared over a million units more than the Maestro. However the Peugeot 306 and its sister the Citroen ZX which were a core product, weighed in with a 5,2 million units, which is twice the combined Metro, Maestro and Montego sales were!

            So we can see that BL just did not have anything like the presence of its European competitors and this is why the Ryder Plan and the M Car strategy were doomed, because both strategies required BL to be able to clear comparable volumes with their competitors, which was simply not possible for them after 1974, no matter how much wish it was.

    • With BL looking at larger Maestro/Montego-based variants as possible replacements for the Ambassador and SD1, one wonders why they never looked at a downsized Supermini-sized version slightly smaller then the Allegro.

      Surely it would have given the company a presence in the higher end of the Supermini sector (with displacements of 1000-1600cc plus scope for 2000cc variants akin to the Peugeot 205) as well as further atomized costs with the larger Maestro/Montego, whilst allowing the Metro to be delayed and utilized to attack the smaller end of the Supermini segment?

    • Agree with Daveh,

      Complete the Maestro first then look at the Metro. Maestro (hopefully) would look slightly more current and make more money. MINI was still selling, keep tweaking it. Love the idea of a Mini turbo!

      • Edward’s saw that, but the Maestro in 1977 had had very little done, only potential new product with any maturity was the the Ado88. If he had gone out with the Maestro that would have still taken till autumn 81 / spring 82 to bring to market and the Montego coming autumn 82 / spring 83. The Ado 88 would thus have only come to market in Autumn 83 at the earliest!

        Although the MINi had held on well in the markets the market wanted fresh metal and so the Mini by 1980 had fallen behind the Fiesta in the UK market and had little if any traction in other markets where it had become a niche product. Also the Ado 88 would have arrived into the market in 83/84 at the same time at the Peugeot 205 and Fiat Uno, it would have sunk without trace and probably taken the Mini with it, as that’s ongoing viability was linked to maintaining A series production volumes.

        But more critically for Edwards, the politicians were not going to give him until 1981/82, to put some new metal in the showroom. We should remember that the Treasury recommended that BL not be given the money to move the LM10/11 to production anyway and the Ado88 was dependent on new working practices being agreed. Thatcher and Tebbit only pushed it through, because they wanted time to get alternative employers into the UK.

        So it was not a choice and as I explain above, if it had been a choice it would have done little to help the Maestro, arriving at best 18 months earlier in the market would have had little impact, the Escort Mk3 would still have had a years head start on it, the Astra 2 years.

  2. I think that Michael Edwardes did a tremendous job in turning around a failing company in terms of its working practices and culture. However he wasn’t around long enough to get product quality improved to an acceptable level – at least not with “new” models. His legacy in that regard is essentially the Metro, Maestro and Montego, all of which suffered quality and reliability issues… and here in the north of the UK it was clear that their bodywork couldn’t cope with the relatively damp climate.

    So while he was very successful in sorting out the “internal” problems, as far as the buying public was concerned, all that really mattered were the products. The Jaguars and Rover SD1 did improve noticably during his tenure but such “esoteric” models, understandably having relatively low sales figures, did not provide the funding to keep BL viable. It was the aforementioned “ordinary” models that were needed for that… and in that respect, I don’t think he achieved the success that he needed to. I imagaine that he was gutted when the Maestro and, particularly, Montego were finally launched (after he had stepped down) and were soon attracting publicity for all the wrong reasons.

    The motivation for his (premature?) departure from BL in 1982 seem to be a contentious issue. His own superb book notes that after pushing through badly-needed reforms and (apparently) setting BL onto the road for success (rather than its previous cul-de-sac-de-calamity!), he felt it was an optimal time to step away. Yet other accounts suggest that he was essentially sacked by Margaret Thatcher – perhaps partly because of his public criticism of her government’s attitude to industry.

    (Keith: Might be a good idea to proof-read submitted articles as there are a few typos and grammatical errors here.)

  3. He managed to end the culture of union militancy and endless, petty strikes that were crippling the company. Most workers were probably heartily sick of being dragged out on strike, losing money and seeing their company become a national joke. Also reducing the number of strikes and closing unproductive factories saw productivity rise in the early eighties and British Leyland look more secure than in 1977.

  4. Fabulous article. Always admired him & his book was a fascinating read. The untold stories of badge holes being drilled & filled etc. need to be expanded on before they’re lost in time. Please share!

  5. Thanks Stuart – there’s not a lot more that I can say except that my dad was a regular ‘blue-collar’ guy at Pressed Steel in Swindon between 1959 and the very early 70’s. Like a lot of blokes, he just wanted to get on, and do a good job. When he joined in 59, a long duration strike started the day he started. We were desperate for money having just moved up from Winchester – so dad and six others broke through the picket lines and went to work. There was a picture of ‘the six’ in the local press – unfortunately lost over the years. My dad was the quietest most even tempered guy on the planet but so many times he came home utterly despondent with the crazy antics of the unions – and the ‘walk outs’ that followed. On the Mk 1 Sprite, he noticed that the sills were not fitted correctly and stopped the line. Rather than trying to find out where it had all gone wrong – the union called a strike – on what basis I cannot remember! As an inspector he was always between a ‘rock and a hard place’ – if he found something wrong – it was just trouble. Thankfully he was a man of great integrity and did he what he had to do – come what may. Apart from his immediate circle of friends he was about as popular as a spot on the bum. Hopefully all this is a far cry from the mutual respect that we promote these days.

  6. You could say Edwardes main achievement was saving Jaguar from extinction and the tie up with Honda, which created a successful range of cars from the Triumph Acclaim to the Rover 600. I’m sure had he not formed an alliance with Honda, then British Leyland could have gone under quicker, and then if Jaguar wasn’t given home rule and underwent a huge quality drive, then it would have died out in the early eighties.

  7. To an extent they didn’t have a choice, but the flaw with the BL plans during this period is that by cutting capacity AND the range of cars so drastically they ended up with an Austin Rover by 1982 which had lost its specialist products (like the MG and TR7 sportscars) and its European factory in Seneffe, and was now a purely UK based volume manufacturer, without the volumes to support such a model

    Even is the M cars had sold better, volumes would still have been far too low to support future product development. 600000 a year (which I assume must be around the maximum Longbridge and Cowley could have produced of all the models) isn’t a viable business when VW were producing more Golfs every year alone.

    • Wasn’t the 600000 figure after the closure and sell off of Morris Cowley plant, leaving just psf Cowley and Longbridge left?
      As per previous arguments, the mud rangers should have come first, as it was not until 78 that any engineering work was started, and less than 4 years later it was ready, while the metro didn’t appear til 80 and was supposedly ready? Think that was Edwards covering his back after the fact and with hindsight.
      Secondly, if a decent midline had come to the market which was built right, looked right and went right the Euro markets would have returned.
      Thirdly, why reinvent a wheel with the r and s series when they had the o ready and waiting in 1.7? Could they not shorten the stroke to make it a 1.6 and therefore saved on costs of developing another engine (as well as time), as the 2.0 fitted and was used?
      As was said earlier Spen King put a fine point on it, Edwards had his eyes set on certain bits of the business and its issues and let others, ie Musgrove and Horrocks to run the rest, and as we know they were sacked by Graham Day. Coincidence that the M cars had issues at the start, as had the 800? And that after there departure the R8 was the opposite?

  8. Looking back it was terrible mismanagement to have NO new product launched between 1976 and 1980

    Yes the Metro was desperately needed, but shocking decision making to start developing ADO77 and SD2 in the early 70s, merge them in 1975 and then cancel this completely, leaving no new mid range saloon until 1984!

    Especially bad as the Marina and Dolomite were significantly older than the Allegro and more antiquated.

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