Ian Nicholls, AROnline‘s historian-in-residence, tells the story of Austin-Morris, and their part in the downfall of the British motor industry.
Here, in the fourth part, we track the events which occurred immediately after the formation of the Austin-Morris division and the initial effect of this rebranding of what was formerly the British Motor Corporation.
The Austin-Morris story: Planning for the future
The new year of 1969 dawned with the news that Sir Donald Stokes had been given a peerage – henceforth, he would be known as Lord Stokes of Leyland. At the same time, the media was reporting that the new ADO14, which was still being referred to as the 1500 in the press and was the first completely new car to come out of the former BMC factories for over four years, would be offered for sale only by Austin dealers.
Disappointed Morris dealers, who comprised the other half of the retail side of the Austin-Morris division, were told that further new models were in the pipeline for them, but there would necessarily be a gap between the arrival of the ADO14 in the spring of 1969 and the first exclusively Morris model, which became the Morris Marina (ADO28) of 1971.
Small quantity production of the new ADO14 Austin had already begun at Cowley, the traditional home of Morris cars. This was dictated by the need for a smooth change over from existing models. The Austin Cambridge (ADO38) series assembled at Cowley was being phased out, but the Morris Oxford version would continue for the time being – in fact, the Traveller version of the Morris Oxford ceased production in February 1969, but saloon production lingered on until April 1971.
Read more: BMC and BL development codes
Austin Maxi: patience is a virtue
According to the press, George Turnbull (above) was determined that the 1500 would not come to the market until it was absolutely ready. He described it as ‘the toughest job in my whole team.’ The spectre of the enormous damage caused by the premature appearance of the BMC 1800 (ADO17) in 1964 still haunted Longbridge.
He was quoted as saying; ‘Preparation and testing, and then more preparation and testing, was my policy at Standard-Triumph and it remains my policy here. We are doing tens of thousands of miles of road testing and general bashing about. The success of the 1500 is of the utmost importance to everyone in the Austin-Morris division. It is aimed at the biggest growth sector of the market and I don’t want it going off half cock, even if it means holding the car back for a time.’
Eric Lord (above), the Cowley Plant Director, talked to author Jon Pressnell about the start of ADO14 production: ‘With the cable selectors you couldn’t get the gears. I remember going to George Turnbull and saying “we’re going to get a dreadful reputation with this car. There is nothing we can do to adjust these cables so they will stay adjusted. It’s got to come to a rod change. Can you please stop production until we’ve got a rod change? Otherwise we’ll get a terrible reputation for poor gearchanges.” We found this out within the first week of production, but we still went on making the things, when we knew what we were making was rubbish.’
Introducing new cost-control measures
Read more: Austin Maxi prototypes and development
The 1500 was also being subjected to the tightest cost control of any model hitherto produced in the old BMC factories. Central purchasing for the whole British Leyland group was considered but rejected in favour of what George Turnbull described as ‘centralised control of prices by consent.’
The group’s Supply Directors met regularly under the chairmanship of Bert Walling, an ex-Ford man who was now Turnbull’s supply chief at Longbridge. They shared the savings produced by bulk buying, but each division remained fully profit accountable.
How well the Austin-Morris division had buckled down to the immediate task of producing cars was reflected in its year-end production figure of over 691,000 cars compared with 539,000 in 1967, an increase of 11.2 per cent. This was impressive, especially as the UK car market had slightly declined by 0.5 per cent in 1968. Combined Mini and BMC 1100/1300 (ADO16) production increased by 14.3 per cent, while UK sales surged by 15 per cent to reclaim the top spot as Britain’s favourite new car. Sadly, these impressive results came too late to save the jobs of Sir George Harriman and Alec Issigonis.
So what had Turnbull inherited?
On paper, the Austin-Morris division had a nominal capacity of one million cars annually, but George Turnbull considered that in practice this figure could not be reached without further expansion. He was looking for around 850,000 in 1969. The establishment of a new model policy to follow on after the upcoming 1500 was his most pressing task.
‘If we can get that agreed in as much detail as possible over the next five years and then tentative for a further five years, we have the cornerstone on which to build this division. Many other decisions follow from this. We started from the premise that the badge engineering concept is not a satisfactory one. In the short term it was probably necessary, but in the ultimate we consider it necessary to produce a completely new range, which will not be available for a year or so. This, combined with the decision to market Austin and Morris as two separate franchise lines, has also conditioned our thinking on model policy.’
Harry Webster (below), the division’s executive Chief Engineer, who, like Turnbull, came from Triumph, was the key figure in the Design Team now working on the new Austin-Morris models. He was recruiting a number of top calibre Engineers to strengthen the old BMC team and to shorten the long time lag between drawing board and production. Unfortunately, Webster now had to answer to the ex-Ford Cost Controllers who had been imported into BLMC, courtesy of John Barber, and so had less design freedom to create new models as the price of every component was minutely analysed by teams of money men. Although he didn’t know it at the time, Harry Webster had already designed his last great car.
Plant upgrades as well as new cars needed
BMC’s critics had made much of the need for extensive modernisation of its plants, but George Turnbull said he was pleasantly surprised when he arrived to find so much really first-class equipment. He said: ‘Where it does not appear too impressive, it is because production facilities are split up into a number of factories rather than concentrated into one huge production unit. A number of buildings housing machine tools are in need of reconstruction and this will be done. In other areas there will be some updating of plant. But until we get our model policy right we do not know how best to organise our manufacturing resources.
‘Although we do not know what is going to happen on the home market in the spring, whether or not the Chancellor’s measures will bite much deeper than we hope, nevertheless, on the export side we have booming order books with the United States and Europe going great guns. I am anxious to stock up the trade from now on so that, when spring selling starts, we shall be in the best possible position to increase our share of the market.’
On 7 January, a styling buck of a coupe derivative of the ADO28 was photographed, presumably at PSF Cowley. Roy Haynes’s team was making rapid progress.
The rivals up their game
At the beginning of 1968 Ford of Great Britain had replaced its Anglia model with the new Escort. The Ford management’s deep rooted conviction, derived from the strip down of a Mini in 1960, that there was no money to be made from front wheel drive cars, was exposed for all to see. Despite the temptation to do otherwise, the new Escort was conventionally engineered and quite clearly made to a price like its larger sibling, the Cortina.
Despite this, the new Escort was an immediate hit. Ford manufactured 156,272 in 1968 and sold 112,169 in the UK. Quite clearly many of these were substitutional sales from the Cortina, contributing to its fall from the top of the sales charts, but the Escort was a far more convincing replacement for the Anglia, and competed in both the private car market and for large fleet sales as a cheaper alternative to the Cortina.
Moreover, while Austin-Morris based the ADO28 project on the existing Cortina Mk2, Ford was looking to replace that with a slightly larger model. The impact on Ford’s finances in 1968 of the new Escort was clear to see. In 1968, Ford of Britain produced 702,629 vehicles of all types and declared a pre-tax profit of £43 million. This equated as a profit of £61 per vehicle produced. Their previous best year production wise had been 1965 when the company had produced 700,976 vehicles, but only declared a profit of £8.9 million, or £12.69 profit per vehicle.
Ford in the ascendancy
The 1968 financial performance of Ford was all the more impressive when one considers that, like Austin-Morris and the 1800 (ADO17), it had one serious under performer in its ranks in the form of the Mk4 Zephyr/Zodiac executive car. It was fortunate for British Leyland that the Escort impacted little if anything on its Austin-Morris division. The Escort seems to have hurt Vauxhall and Rootes Chrysler the most.
In 1968, Vauxhall produced a record 247,034 cars but, the following year, this dived to 169,456 units and Vauxhall’s sales would never exceed the 200,000 mark again. In 1967, Rootes Chrysler sold 135,081 cars in Britain, but this dived to 112,503 in 1969 and 97,307 in 1970. This also demonstrated how internecine the battle for fleet car sales was.
Nevertheless Ford’s impressive financial performance suggested that the Dagenham way was the only way, and British Leyland was already actively recruiting many ex-Blue Oval employees, many of them finance people skilled in cost control, who had joined Ford thanks to the recruiting programme set up by John Barber. One of those who joined British Leyland in 1969 was Desmond North, a former Ford and Chrysler cost control specialist. He soon created a department to oversee the costing of the next generation of models. Austin-Morris now had to make the ADO28 appeal to the fleet market when Ford now had all the marketing avenues covered.
The industrial relations issue
The other issue affecting Austin-Morris was the rapidly declining industrial relations climate. In 1967, an aggregated 2,787,000 days were lost due to strike action in all UK industries and services. In 1968, this soared to 4,690,000 aggregate days, an increase of 68 per cent. Things were even worse in the motor industry. In 1967, 504,000 aggregate days were lost, this increased to 898,000 in 1968, an increase of 78 per cent.
Prime Minister Harold Wilson resolved to act as he saw his vision of a planned economy fuelled by increased industrial production beginning to evaporate. On 15 January 1969, a government white paper – In Place Of Strife – largely drafted by the Prime Minister and his Secretary of State for Employment and Productivity, Barbara Castle, was published.
Among its numerous proposals were plans to force unions to call a ballot before a strike was held and establishment of an Industrial Board to enforce settlements in industrial disputes. However, opposition from the trade unions, cabinet ministers led by James Callaghan and within the governing Labour Party resulted in the proposals being watered down and then a settlement was eventually reached later in the year with the Trades Union Congress (TUC) whereby the proposals were dropped.
The whole debate about what to do with the strikes that were crippling the economy caused a schism in the ruling Labour Party as the right to strike triumphed over the need for more production. For firms like British Leyland the situation would get a lot worse before it got better.
The Austin Maxi is scooped
Then, on 19 January, the Swedish newspaper Expressen published scoop photographs of the forthcoming ADO14 Austin 1500 undergoing winter testing in Finland.
The newspaper said: ‘Expressen can today as the first newspaper in the world present news the automobile world has been waiting a long time for – a big Mini from BMC with an overhead camshaft! According to the Financial Times the new model will be presented in March this year.’
Subsequently members of the Austin-Morris testing team were carpeted for allowing a photographer to get close enough to capture images of the new overhead camshaft E-Series engine. One of those on the carpet was Brian Griffin, son of senior Austin-Morris Engineer Charles Griffin.
Rationalisation starts in earnest
Lord Stokes made clear that he was opposed to a brutal rationalisation programme at British Leyland when attending a lunch in London on 30 January. He said: ‘We didn’t join BMC and Leyland together to destroy it. We formed it to give our people a sense of permanent employment.’
The next day British Leyland sent its first Annual report to 200,000 shareholders and in that the company’s Chairman, Lord Stokes, made clear that he would not sacrifice the interests of his 188,000 workers in the quest for rapid rationalisation and bigger profits. He said: ‘We still have a long way to go if we are to achieve all the economies and improvements in efficiency which the merger has made possible. We could have moved ahead more quickly… but we have gone out of our way to avoid large-scale redundancies. In the long run it is right, as far as we can, to balance the interests of the employees and shareholders in this way.’
The British Leyland boss was now publicly trying to justify why the expected rationalisation of the company had not taken place. He was also, in effect, telling the members of the British Leyland (Motor Corporation Combined) Trade Union Committee (BLTUC) that they held the whip hand in dealings with management. British Leyland shares had risen by about 40 per cent, since its merger was completed in the spring of 1968.
Austin-Morris plans to up production
On 4 February, a spokesman said that the Austin-Morris division of British Leyland was planning to increase output in 1969 by nearly 25 per cent. The 1969 production target was 850,000 units, 160,000 more than 1968’s total. The figure, he explained, included sets packed in the UK for assembly overseas. The division’s target of one million cars in a year would be reached within the next two years, he added.
The then-current level of production at the four assembly plants in the division, at Longbridge and Adderley Park in Birmingham and at Oxford and Abingdon, was now running at just over 18,000 vehicles a week.
In a special supplement which appeared in the then-current issue of the works newspapers, Lord Stokes, the Chairman, said that the profit of £37.9 million up to the end of September 1968 did not equal the average profits of the constituent companies over the previous five years. The total sales for the 12 month period were £907 million and the profit before tax was just over 45 per cent of turnover, a margin of ten pence in every pound of sales.
Lord Stokes said: ‘This is not nearly as good as some of our major United Kingdom and European competitors. To keep with the best we need to generate something like twice as much, which sounds ambitious. But we could achieve it if we could avoid production interruptions. We estimate that we lost 80,000 vehicles in 1967-68 through such interruptions somewhere in the industry.’
Financial results published as Haynes leaves
In the 1967/68 financial year British Leyland had manufactured 1.05 million vehicles, including 719,477 cars from the BMC/Austin-Morris division. This equated to about £36 profit per vehicle. Nearly three weeks later, it was revealed the Austin-Morris management had decided to close the styling studio at Pressed Steel Fisher at Cowley and move all styling activity to Longbridge.
However, senior Styling Director Roy Haynes (below) decided he would not be making the move and resigned only 16 months after being wooed there from Ford by BMC, where he had designed the Cortina Mk2. The Daily Express quizzed him on the reasons for his surprise departure. He said: ‘There has been a difference of opinion between myself and other Directors.’
And he strongly denied a claim by British Leyland that he had left because of the decision to shift the firm’s design centre from Cowley to Longbridge. He added: ‘The move to Longbridge is not a happy one, but most people are prepared to work in most places. It goes deeper than that. I am leaving for personal reasons and I don’t want to elaborate.’ A British Leyland spokesman said: ‘We are very sorry to lose Haynes, but his resignation was because of his domestic commitments in Essex and he did not wish to move to Birmingham.’
According to the Daily Express, Roy Haynes’s wife ran a successful business in Essex and refused to move. Roy Haynes had commuted between Cowley and Danbury, Essex, but the extra distance to Longbridge may have made this impossible.
The ramifications of Haynes’s departure
Of all the post-merger departures from British Leyland, on the surface this was the most surprising. As an ex-Ford Product Planner, Roy Haynes was seen as the most amenable of BMC’s senior staff to abandoning the Issigonis way of doing things, but his ideas were too radical for the incoming Leyland management. He appears to have fallen out with Harry Webster as early as August 1968 when Webster commissioned regular Standard-Triumph stylist Michelotti to submit a design proposal for the ADO28 programme.
The viewing on 5 August 1968, also featured a submission from Pininfarina as well as the Austin-Morris Design Studios’ winning design. Harry Webster later said: ‘I thought Michelotti’s was best, but the main board voted for Haynes.’ Roy Haynes also objected to the use of the Triumph Vitesse gearbox in the ADO28, for which £1.9 million was earmarked for re-tooling.
When Roy Haynes had been hired in October 1967, Joe Edwards had set up the PSF Styling Studio at Cowley to make it independent of Dick Burzi and Alec Issigonis at Longbridge. However, it appears that Harry Webster was determined to bring body engineering back under Longbridge’s jurisdiction, hence the closure of the PSF studio.
Haynes undermined by Harry Webster
One can see that Roy Haynes felt he was being undermined by Harry Webster, who in turn had the ears of George Turnbull and Lord Stokes, and thus had no practical input into Austin-Morris product policy. These were not the terms of employment he had agreed to in October 1967.
Many years later Roy Haynes said: ‘It meant relinquishing my lifetime’s ambition to see a British automotive company develop into an aggressive market leader worldwide. But there was no point in staying. My philosophy was totally at odds with Webster and Stokes. In one newspaper feature Stokes said he had disagreed with me because I wanted to have too much standardisation – one bodyshell for the whole of British Leyland – and then make it into an Austin, Morris, Jaguar or Rover.
‘This was simply not so. My plan was to sink the hidden engineering costs over about four or five model ranges. My policy would not have reduced ‘brand identity’ of the individual cars – just the opposite. It increased the possibility of developing brand identity by reducing investment in hidden areas of manufacture. It would undoubtedly have led to redeployment of labour and I think that was the real crunch at the time.’
The newspaper feature that Roy Haynes referred to was probably an interview with Lord Stokes published in the October 1969 issue of CAR magazine. Roy Haynes later blamed the Leyland merger for the demise of BMC. However, in hindsight, his departure was another flashpoint in the clash of Joe Edwards and Leyland’s differing BMC recovery plans. As he had been hired by now departed Joe Edwards, Harry Webster had no obligation to listen to his views.
Austin Maxi teething troubles surface
The BLMC Board met in February 1969 and on the agenda again was the ADO14. Harry Webster reported that the ADO14 gearbox was suspect and Lord Stokes said this was very disturbing as it was vital that this model should be successful. Webster said that the fault in the gearbox was only a matter of detail and ‘if we catch up to last weekend, the gearbox should be alright’.
The four-door saloon ADO14 was signed off as fit for production on 15 February (above). Perhaps at the same meeting Austin-Morris Managing Director George Turnbull reported that 63 wage claims were lodged in 20 days. That same month The Times newspaper interviewed Filmer M. Paradise, the American who was formerly Ford’s top man in Italy, and who joined BMC in June 1967, to rejuvenate its European sales force. Now he was Director of Sales for Austin-Morris at Longbridge.
‘Unlike my approach in Europe, I really felt that my reputation preceded me here at Longbridge. I think people were expecting a revolution,’ he said. ‘They were certainly uneasy. It was a situation, which would not have been served properly by barnstorming in and throwing my weight about. Everybody was expecting a lot of firings. Morale was low and I had to nurse it carefully.’
The sales force gears up
So instead of getting rid of people Filmer Paradise (above) began a massive series of interviews with existing personnel. ‘I was looking for the kind of people ready and able to do things that had never been done before. The pleasant thing is that I found so many.’
The exercise resulted in the emergence of an eight-man team with an average age of only 38 compared with its predecessors’ average of well over 50. Mr Paradise himself was the oldest, at 50. Then came 48-year-old Bernard Bates, Director of Home Sales. Export Sales Director Michael Trodd was 44, Vehicle Sales Manager Michael Heelas was 40. Programming and Distribution Manager Henry Jelinek was 36, Organisation and Administration Manager Douglas Pittaway was 34, while Financial Controller Tony Aston was 30 and the youngest in the team. John Gorton, Filmer Paradise’s Personal Assistant, was 27. With the exception of two they were all former BMC men. Henry Jelinek and Tony Aston came from Ford.
Filmer Paradise said: ‘We are most reluctant to keep concentrating on any one company. There are times when we wish that the other automotive companies in the United Kingdom were more capable so that we could find some of our key people there. That there is pirating in the automobile industry is a very natural thing. Ford trains droves of young people who cannot advance. But the fact is that you cannot get anyone to come who doesn’t want to move. These people at Ford have made their own appraisal of British Leyland and they have come to the conclusion that Austin-Morris is a growth company offering fine opportunities.’
The Ford men: were they all that good?
Some BMC men would later suggest that those ‘young people who cannot advance’, were in fact some of Ford’s less able executives. Filmer Paradise discussed one of his best men, Bert Lawrence, 33, who was recruited from Ford Europe two years before to join the American as his General Sales Manager in Lausanne.
‘He is one of the most able young Englishmen I know anywhere in the international automotive business.’ Bert Lawrence had been given the task of attempting to reorganise Austin-Morris’s 5,000 retail outlets. In reality reorganise was a euphemism for cull. It was a job which Filmer Paradise admitted would take him several years. Although Lord Stokes’s decision to retain both Austin and Morris franchises and to give them entirely different model ranges had taken off some of the immediate pressure, it was considered that there were still too many dealers.
Just before he left for the Geneva Motor Show, Filmer Paradise called a meeting of every distributor in the country. Only 12 failed to turn up. When he introduced a system of ten-day reports requiring distributors to complete the most detailed returns of stock and sales three times a month, he achieved a 100 per cent return.
Austin-Morris starts to bounce back
According to the article in The Times, confidence lost in the lean times of 1966-67 was flooding back. The Mini was selling better than ever and the 1100/1300 (ADO16) range was again the best seller in the United Kingdom with 14 per cent of the UK car market. From a 28 per cent market share in October 1968 the Austin-Morris division as a whole now held 31 per cent. Filmer Paradise was adamant that within two years this would be over 35 per cent.
‘When the boss arrived last November morale could hardly have been worse. Today nothing is impossible. If he says 35 per cent is possible then that’s it,’ said a member of his staff.
In a Britain which was seemingly locked outside the Common Market permanently, culling the dealerships made sense, but many of the dealers stripped of their BMC franchises refused to roll over and die. With the Japanese manufacturers looking to assault the UK market there was a ready-made network of dealers looking for a new range to sell in order to replace their lost BMC franchises.
Merging the Cowley and Longbridge Design Studios
During April 1969 the Austin-Morris Exterior Design Studio transferred from Cowley to the glass greenhouse at Longbridge, formerly occupied by Dick Burzi. The Interior Design Studio would remain at Cowley until October 1969. It appears that Dick Burzi and Sid Goble of the Longbridge Styling Studio were not informed about the re-location of the Cowley Designers and were surprised when they all arrived, having been threatened with redundancy if they did not make the move from Cowley. Dick Burzi retired soon after.
That same month Lord Stokes told the BLMC Board that there were 100 outstanding labour disputes and that Trade Union officials and stewards were losing their power over the shop floor.
Longbridge workers walk out
A typical dispute occurred on the first day of the month. Three thousand men were made idle at the Longbridge factory after a car assembler on piece work rates accidentally picked up a fellow worker’s pay slip, and saw that hourly paid men were earning as much as piece work men.
One thousand assemblers on piece work then walked out, halting production of Mini and 1800 (ADO17) models. A further 2000 men were laid off. The strikers, on day and night shift assembly, claimed that hourly paid workers, who were all employed on sub units, depended on the efforts of pieceworkers.
The men who walked out said that in some cases the hourly-paid men, who guided car bodies and other sub units into position on the track, and also viewers were earning more than them. The disparity in wages stemmed from a job evaluation exercise brought in by the management, said the assemblers. The desire for pay parity and then the maintenance of pay differentials was causing havoc throughout British Leyland.
- Back to History : The Austin-Morris story – Part Three : October to December 1968
- Forward to History : The Austin-Morris story – Part Five : April to December 1969
Early 1969: Model changes, launches and deaths