History : The Complete BMH Story – Part One

Ian Nicholls, AROnline’s historian-in-residence, charts the history of the short-lived merger between BMC and Jaguar in this four-part account of the British Motor Holdings years from 1966 to 1974.

It’s a tale of ill-judged hirings and firings, odd and disastrously bad product decisions and a night of the long knives. Read on to learn more about this short but turbulent period of automotive history.

Was BMH doomed to failure?

Leyland Chairman Donald (Lord) Stokes: A feared but highly respected statesman prior to the fall of BL. His knowledge of the bus & coach market knew no bounds.
Leyland Chairman Donald (Lord) Stokes: A feared but highly-respected statesman prior to the fall of BL


‘When I think back we were pretty cheeky really to attempt to do everything we have done with very limited financial resources. But if the merger had not taken place it would have been the end for the British motor industry. BMC would have been broke in a year and Leyland would have just plodded along,’ Lord Stokes, Chairman of the British Leyland Motor Corporation, May 1972.

The traditional story of the creation of British Leyland is that British Motor Holdings, bereft of exciting new models, saw its UK market share slump to 27 per cent in 1967 and then announced a £3m loss in the financial year ending July 1967. Sir Donald Stokes’ dynamic Leyland Motor Corporation with Government backing, moved in and engineered an effective takeover of BMH and embarked on revitalising BMC with the urgently needed new models.

In the papers

This was the view was propagated by the book The Leyland Papers by Graham Turner, which some might see as a hagiography to Lord Stokes, who was the Richard Branson of his day, backed by ace public relations man Keith Hopkins. Only later was an alternative viewpoint available, Men and Motors of the Austin by Barney Sharratt, featuring interviews with people who worked under the new Leyland regime.

So, was BMH really going bust?


We shall start our story on 9 June 1966. The previous year the British Motor Corporation had purchased the Pressed Steel Company, the car bodybuilding firm.

Today BMC announced a management re-shuffle.

Sir George Harriman, the Chairman and Managing Director, was appointed Executive Chairman and Joe Edwards was appointed Managing Director. Mr Edwards continued as the Managing Director of the Pressed Steel Company. Joe Edwards had left BMC in 1956 after a falling out with the then Chairman, Sir Leonard Lord. Joe Edwards had a record of wielding the axe during his previous tenure at BMC and seemed to have the ruthless management streak that Sir George Harriman lacked.

He later said. ‘I found that nothing had happened in the 12 years I had been away. The company had unwound. It was the Lord Harriman regime just staggering from one thing to another. There was no forward thinking. There was no question of getting hold of new people. They did not believe in training management. The management was just not equipped to run that size of company.’

The next big development came on 6 July 1966 when Sir William Lyons of Jaguar Cars agreed to a takeover by BMC for £18.2m.

There were four reasons for Sir William Lyons agreeing to sell his Jaguar company to the British Motor Corporation.

  1. Lyons was without a son and heir. His only son, John Lyons, was killed in a car crash in May 1955 on the way to Le Mans.
  2. Jaguar needed to secure its body supply, which came from the Pressed Steel Company now owned by BMC.
  3. Jaguar needed access to the funds necessary to put the XJ4 saloon into production. Although the company was profitable, its most advanced car, the Mk10 saloon, was not a strong seller, the other saloons were based on the ageing Mk1 of 1955 and the E-type was allegedly barely profitable.
  4. Jaguar was already discussing a Mk2 replacement and BMC had the resources to bring such a project to fruition. A compact executive saloon was an area where BMC were weak.

The Jaguar/BMC merger was announced on 11 July 1966.

Government intervention

Then, on 20 July 1966, the newly re-elected Labour Government announced hire-purchase restrictions and an increase in purchase tax also generally termed as a credit squeeze. Typically, the anti-inflationary measures bore down hard on car buying.

The 25 per cent auto-purchase tax was increased to 27 per cent, minimum down payments were hiked from 25 per cent to 40 per cent and the time allowed for payments was cut from 27 to 24 months.

On 1 August 1966 the stocks of unsold BMC vehicles stood at 70,000 – the distributors held 60,000 and the factories 10,000. This compared with the equivalent figure of about 45,000 vehicles for the year before of which distributors held 42,000 and the factories 3000.

On 18 August 1966, with the Government having inflicted a credit squeeze, the British Motor Corporation assured the unions that no short-time working was being planned for the time being.

Then, on 1 September 1966 at Longbridge, BMC Managing Director Joe Edwards met the heads of BMC’s nine distributor association zones. The distributors were asked for their assessment of home sales decline in the next six to nine months as a consequence of the credit squeeze: they predicted a drop of 15 to 20 per cent.

Stocks mounting up

By 3 September 1966  the British Motor Corporation now had a total of 115,000 unsold vehicles spread throughout the country; distributors held 80,000 (many of them stored in specially rented fields and open plots of ground) and BMC had another 35,000.

After the 1 September meeting, BMC’s cost accountants had prepared a revised production programme for the remaining 11 months of the financial year up to 31 July 1967. Hand in hand with this went the vital question: redundancy or prolonged short-time working to meet the diminished schedule?

On 6 September 1966 the BMC management chose redundancy. This was their argument: they were in the position where they produced only four-fifths of what was possible; yet had a labour force geared to producing one million plus vehicles – if BMC didn’t prune their excess labour, they faced a huge excess of overhead charges during the year.

Ford sees it coming

Ford of Britain claimed it had seen the crisis coming back in May of 1966 and immediately cut back on overtime to avoid stockpiling unsold cars.

BMC’s answer to the armchair critics who said they had neglected to read the market thermometer earlier in the year, was to point to their predicament in the previous year. Industrial disputes and the West Midland gas shortage had robbed them of 100,000 vehicles.

Their results for the first half of the 1965-66 financial year were appalling; profits had dropped from £11,600,000 to £7,149,000; a planned production target of 521,500 vehicles (which would have meant an increase of 61,000) turned into a gloomy below par output of 435,750.

‘Consequently, we were going full tilt to try to make up for these very heavy losses. Unfortunately, we were going so fast that we ran into the arms of another crisis,’ said a BMC spokesman.

Mass redundancies

During the 1956 credit squeeze 6000 men were sacked by BMC. Even within BMC the word ‘brutal’ was used to describe it. By the time of the 1960-1961 credit squeeze, Joe Edwards had left BMC and the firm took the other way out. Two-thirds of the labour force went on short time; eventually many of them were down to two days a week.

BMC chose short time then for two reasons: it was banking on the recession being over by early spring, and it didn’t want to spoil the improving employer-employee relationships.

But now Joe Edwards was back and harsher measures were the order of the day. Sir George Harriman and  Joe Edwards of BMC then went to see the Minister of Labour, Mr Ray Gunter, at his office in London on September 9th 1966 to inform him of their redundancy plans.

A meeting of minds

Having gained the Minister of Labour, Mr Ray Gunter’s approval, management heads from each of the 22 factories in the BMC group met at Birmingham, presumably Longbridge, on 10 September 1966, a Saturday. They decided that individual managements should be responsible for deciding which workers were to be made redundant and to produce a programme that would get most people back on a full working week afterwards.

Over the weekend more than 130 letters were prepared for sending to all national and local union officials signed by BMC’s Director of Personnel and Welfare, Barry Mackie, and Robert Chapman, Personnel Director for the Pressed Steel-Fisher group.

The British Motor Corporation announced on 13 September 1966 that between 20,000 and 30,000 workers – about a quarter of their labour force – would be placed on a three or four-day week immediately because of the economic situation resulting from the credit squeeze. BMC gave warning that ‘short-time working does not always produce the economies needed. Therefore there will be some redundancy.’

‘The object is to have everybody working a five-day week as far as possible and this can only be effected by having redundancies. During the next few weeks of short-time working, the corporation will be studying its labour requirements in the light of credit and other restrictions which have reduced demand for vehicles in the United Kingdom.’

‘Details of short-time working will, as is customary, be discussed with employee representatives in the factories involved. Where a reduction of establishment is necessary, the corporation will of course fulfil its obligations both under domestic agreements and under statute.’

Harriman’s response

Sir George Harriman, the Chairman of BMC, said: ‘Naturally this decision has been a great disappointment to us although it was the only possible one for us to take.

‘No organisation, however large, can withstand indefinitely the effects of a national economic crisis and the credit restrictions and other measures resulting from it.’

BMC had made every effort to inform the workforce first but, unfortunately, the press had got wind of the story. The day after the news broke, local union officials finally received the letters from BMC informing them of the short time working and redundancy programme, which caused much anger.

Two thousand men at the BMC’s tractor and transmissions factory at Washwood Heath stopped production for the afternoon of 14 September when they walked out to hold a meeting. They voted unanimously that redundancy should not be accepted and that available work should be shared.

Mr Arthur Harper, the works Convener of Shop Stewards, said: ‘We as Shop Stewards do not accept redundancy and our instruction to you is that if any redundancy notices are handed out they should be handed back immediately. If the BMC workers stick together, which I have no doubt they will do, we can lick Harriman and his henchmen. Our policy is no redundancy and we must get hold of our MPs and get hold of this Government and tell them we are not having it.’

After a two-hour meeting, the Shop Stewards on the Austin works committee issued a statement which said: ‘We shall resist any dismissals with all the power at our disposal and to the extent that the workpeople are prepared to back us.’

Mr Dick Etheridge, the Longbridge Convener, said: ‘I am prepared to lead any action, including strike action, to fight redundancies. We will not accept redundancy—we will resist it with all the means at our disposal. Let’s face it, if you are going to get the sack, you may as well have a bash.’

Mr George Evans, regional organiser of the National Union of Vehicle Builders, said the men had now been told which models were to be cut back and what the new production schedules would be. He added: ‘There are no figures for the men, they do not know who will work two days, three days, or four days. They know redundancy will begin on 4 November, but they do not know the details. Our people are bitter and we shall do everything we can to fight this.’

Production cut back

On 16 September 1966, in the biggest cut-back on production since the winter of 1960-61, BMC told 30,600 employees – one in four of their total labour force – that they would begin short-time working in the next week. Of these, 18,500 were at factories in the Birmingham area, 6500 at Oxford, and 5600 in Coventry, Scotland, South Wales and London. Some of these men would work only two days a week. Others would be working up to four days, a management statement said.

At the time it was reported that BMC had more than 100,000 unsold cars in stock.

On 24 September 1966, 333 car delivery drivers employed by 10 of the 19 firms in the Longbridge group of delivery agents received dismissal notices because of the reduction in BMC production, which were to take effect on 4 October. The following day some 450 delivery drivers decided to strike in protest.

The strike meant that most cars would not be delivered to customers. Nor would they be driven from Longbridge to join the thousands of new vehicles parked on fields and airfields up and down the Midlands. The Longbridge works had cut back production of its Austin models from 10,000 a week to about 7000. But only 5000 to 6000 cars could be stocked at Longbridge, where 2000 were already parked.

The British Motor Corporation announced on 26 September 1966 that it was now going to dismiss more than 10,000 workers by 4 November, double the figure it had given earlier. Shop stewards were given details of the BMC redundancies in individual factories. The notices would go out on 10 October to expire on 4 November. Thirty-eight thousand BMC workers were already on short-time.

By 27 September, the delivery drivers strike was hurting BMC. Production lines closed down at Longbridge, Morris Commercial Cars and Pressed Steel at Washwood Heath. All these works were clogged with vehicles.

At Longbridge about 1000 men worked the night shift because extra space had been found to store Minis. Mr George Brown, the Foreign Secretary, in his constituency at Belper, Derbyshire said: ‘In the West and East Midlands we have eight jobs for every person available. I am not competent to say BMC have too many people, but I have my suspicions.’

This was the first public comment by a senior Government minister to allude to perceived inefficiency in the British Motor Corporation. By 27 September BMC told 3500 men employed on engine assembly and machining at Longbridge not to report for work until Tuesday 4 October.

Longbridge now had 11,000 of its 25,000 employees without work.

It was announced that about 1300 at Morris Motors Cowley would be among 12,000 BMC workers sacked on 4 November – this was one-seventh of the manual force.

At Swindon, just over 800 at Pressed Steel would go at the same date and short time carried on for others. The following day the British Motor Corporation issued warning notices of impending dismissal to about 4000 of the 27,000 workers at its main factory at Longbridge in Birmingham. The notices of dismissal would go out in the next week.

Longbridge stoppage

All car production at Longbridge had now ceased. The influence of the Government’s deflationary measures could be seen in the fact that in September 1966 output from the British motor industry was 13 per cent lower than in August, after making allowance for seasonal factors.

The day that Prime Minister Harold Wilson met BMC Shop Stewards at the Labour Party conference was  3 October. The Shop Stewards met Mr Wilson after 600 BMC workers had besieged his hotel, carrying posters and shouting anti-Government slogans. Mr Wilson went out to face them and the shop stewards, led by Dick Etheridge, the convener of Longbridge, asked if a delegation of 12 men could meet the premier. Wilson proposed three and they settled on six. When the Shop Stewards walked in, the Prime Minister counted 12 men.

The next day car production at the Austin factory at Longbridge, which had been at a standstill since Wednesday 28 September because of the delivery drivers’ strike, was resumed.

On 6 October, the British Motor Corporation Chairman, Sir George Harriman, met senior Shop Stewards at BMC’s staff college, Haseley Manor, near Warwick. The 28 men from a score of factories, were led by the Communist Longbridge convener Dick Etheridge. A four and a half hour meeting failed to produce a compromise.

Afterwards, Sir George Harriman said: ‘Bearing in mind the money in exports the motor industry earns, the Government should be prepared to back the horse in form. I would not ask for subsidies but for easement on hire-purchase restrictions, repayment time and overdrafts for dealers who sell our cars, things like that.’

A one-way traffic system had been introduced on roads in the grounds of the Austin works at Longbridge to create more space for storing vehicles. Sir George Harriman, Chairman of the British Motor Corporation met Ray Gunter, the Minister of Labour on October 10th 1966 to discuss the firms redundancy programme.

Subsequently, Sir George said: ‘It would be unwise for the men made redundant to regard this as being a purely temporary situation. Although I cannot look into a crystal ball, I cannot see that the men will be needed in the foreseeable future.’

Sir George said that, during his meeting with the Minister, he had urged that the Government should relax the hire-purchase restrictions which had cut sales at home. ‘But, we got no joy on that one,’ he said.

On 19 October 1966 the Daily Mirror newspaper printed a picture of over 16,000 unsold BMC cars being stored at Wythall airfield. There was more bad news for BMC on 20 October. About 200 workers at Morris Radiators, Oxford, walked out after the management had refused a union request that 28 workers listed as redundant should be absorbed by work-sharing. Morris Radiators supplied petrol tanks, exhaust systems, oil coolers and other components to BMC assembly factories.

By late October BMC was being hit by three strikes. Strike one was that of the delivery drivers; strike two was at Morris Radiators and strike three was a London dock strike. This had the following effects:

  1. They could not make cars at Cowley because of the radiator men’s strike. The production lines were shut down on 28 October.
  2. They could make some cars at Longbridge despite the credit squeeze, but they could not get them to dealers showrooms.
  3. And if they succeeded in getting cars to the docks they could not hand them to overseas customers because of the London dock strike.

The British Motor Corporation had failed to meet its planned output of 983,000 vehicles in the year ended July 1966 by 137,000. The company laid the blame for this on industrial disputes and gas shortages. It was estimated that labour troubles in BMC’s factories and in those of its suppliers prevented the corporation from building 93,000 vehicles, while the disruption of gas supplies in the Midlands stopped another 23,000 from being produced.

Profits before United Kingdom taxation of BMC (including the Pressed Steel Company) were £19,191,000 for 1965-66, compared with £20,959,000 (without Pressed Steel) in the previous financial year. It was on 4 November 1966 that BMC officially made 12,000 men redundant.

The final pay day for the Longbridge men was 11 November. The following list shows the approximate number of workers who had been laid off at 14 motor plants up to 10 November 1966.  The dates indicate when the plants began laying off workers.

British Motor Corporation
Numbers laid off

Morris Radiators, Oxford (31 Oct): 330
Morris Motors (cars), Cowley, Oxford (24 Oct): 6000
MG sports cars, Abingdon (24 Oct): 450
Tractors and Transmissions, Birmingham (1 Nov): 640
Morris Radiators, Llanelli (2 Nov): 400
Austin Motors, Longbridge (2 Nov): 13,000
BMC Scotland (Bathgate) (1 Nov): 120
Morris Engines, Coventry (2 Nov): 100
Pressed Steel-Fisher (31 Oct)
Coventry: 1350
Oxford: 4000 (Only 600 were laid off up to 9 November, when over 3000 more were laid off.)
Swindon: 1400
Common Lane, Birmingham 1050
Castle Bromwich: 7500
Llanelli: 1000

TOTAL 37,340

The Morris Radiators strike was eventually resolved and there was a return to work on 14 November. Meanwhile, the delivery driver’s strike rumbled on. On 22 November, BMC produced its annual report. High on the list of priorities for the British Motor Corporation was the equipping of an engine factory costing more than £10m at Cofton Hackett, about half a mile from BMC’s huge Longbridge works.

The 300,000sq ft building was now ready for its machinery. At least £8million was being spent to provide the most automated engine production plant in the world. In spite of the enforced cutbacks and gloomy predictions that it would be 1968 before BMC was back on its feet, the company was pressing ahead with its original plans to start production at the new plant towards the middle of 1967. Engine production was still the biggest bottle-neck at the height of the sales season.

Cofton Hackett would manufacture an entire new range of engines, the E-Series, and a 1485 cc version would be the first to appear.

BMC was more than ever determined to increase its share of the home market. In August 1966 its share was 38.5 per cent (34.7 per cent in 1965) and, in September, 39 per cent (35.7 per cent in 1965). This was still a long way from the 50 per cent target set by Sir George Harriman, BMC Chairman, who refused to lower his long-range sights.

‘As far as BMC is concerned we are maintaining our investment programmes in anticipation of the future demands of motorists in Britain and world markets in general since our view has always been that the key to business prosperity lies in progressive investment whatever the prevailing economic climate.’

BMC’s target for the financial year ending 31 July 1967 was 1,100,000 units. This was reduced to 809,000 (a 21 per cent cut) and it was based on this production figure that the labour force was trimmed by 12,000. One company official said: ‘We had a labour force geared to our immediate target of 1,100,000. It would be a counsel of despair to set such a target and then believe we could never achieve it. Now we have re-trimmed our labour force for a new target and the signs are that we shall not want any of the 12,000 back in the foreseeable future, certainly not less than a year. We shall use this time for a great deal of inward looking.’

On 24 November, BMC broke the strike by the Longbridge car delivery drivers by sending in two other firms to move cars from its compounds. The strike collapsed and by 29 November the drivers were back at work moving cars. Their strike had lasted a damaging nine weeks.

On 14 December 1966, British Motor Holdings officially came into being, the product of the merger between Jaguar and BMC. Sir George Harriman spoke of the difficult year BMC had just endured: ‘It would have been very easy to let things drift, but I believe that a leaner and streamlined BMC will achieve by greater efficiency a more competitive position among the world’s major motor manufacturers.’

‘We feel this period of re-adjustment is now behind us, and the organisation has recovered sufficiently to be ready for the next step, forward. We are hopeful that, having weathered the storm, there is a brighter future for us to look forward to.’

Besides Sir George Harriman, the BMH Board comprised of Joe Edwards, BMC’s Managing Director; Sir William Lyons, Chairman of Jaguar; Ron Lucas, BMC’s Deputy Managing Director together with his fellow BMC Directors Michael Bellhouse, Alec Layborn and Robin Stormonth Darling.

The following day the British Motor Corporation announced that some of the employees on short time working would be able to resume a five day week in January 1967. However, a BMC spokesman said: ‘This cannot be taken as meaning that BMC’s troubles are over.’

So ended 1966. Joe Edwards and Sir George Harriman had bitten the bullet and responded to the credit squeeze and reduced over-manning, but in doing so they had damaged industrial relations in their plants. The delivery drivers and Morris Radiators strikes had prevented BMC from selling their excess stock to bring revenue in, something that was conveniently forgotten in later years.

Forward to History : The Complete BMH Story – Part Two : 1967 – The knives are out

Ian Nicholls
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  1. Wow, what a door-stopper of a blog ! Agree with much of the analysis, and it certainly reminds us that running BMH/BLMC wasn’t quite as simple as all the armchair experts would like to think. Frankly, it’s amazing that it took so long for the final quietus to arrive in 2005 – achieving what Sir Michael Edwardes called a ‘Soft Landing’ wasn’t easy for any of us involved during those decades of struggle.
    Would remind everyone that John Barber stymied the Allegro’s initial chances by insisting on a huge 10% hike in all the launch prices literally days before launch. Just check it out – Allegro 1500/1750 was priced directly against Maxi and 1800!

  2. Issigonis may have designed the two best-selling cars in Britain; but they were sold at a loss, rusted badly, and were not as reliable as they should have been (e.g. losing ignition in the rain – which the Germans later called “the British Leyland anti-aquaplaning device”). The 1800 was neither a 1600 nor a 2-litre, and lost valuable time and money. The Maxi should have come first, but was woefully under-developed, even in 1969. BMC were not sustainable.

  3. BTW I clearly remember the evening TV news announcement of the formation of BLMC. The newscaster said “there has been a murder – I’m sorry, a merger – between British Motor Holdings and Leyland Motors”. I am still not entirely convinced that the correction was appropriate.

  4. My late father was in the running to be sales director of would become Austin / Morris at BLMC. He left just before the BMH/BLMC merger. It seemed that the plum jobs would go to Leyland people. I wish I could ask him about the days of BMH. I think thet he found his latter days at BMC very frustrating. He was sent Canada in 1959 to be next boss of the NA operations. However to he tried to blow the whistle on the allegedly corrupt incumbant. However he was sacked and returned to the UK and went back as Wolseley sales manager.

  5. Although political chicanery in the unions played its part, the disaster in my view arose form the fact that Stokes, although he was an unrivalled bus salesman, actually knew nothing about volume car manufacturing, or for that matter , selling. This might not have been fatal but for a very serious flaw in his character , in that he would not listen to anyone else – anyone who disagreed with him, including the customer, was an idiot . This attitude spread outwards and downwards . I was the Financial Director of a BLMC dealership in the early 1970s and was horrified to see even senior sales staff treat customers as though it was a big privilege for the customer to buy a car from us

  6. The you will buy as we say attitude hit the bus industry big time, just to keep the Cumbrian white elephant in work, when operators just wanted a slightly modernized RE with power steering and a spring parking brake, and the 6HLXB, not the National with its PITA 0.510 lump. ECW was also culled to keep Workington busy, and the B15 was another BL blind alley, with penny numbers sold outside London, which caused the hasty re-develop with the very successful Olympian. Shutting Workington would have made much better sense, as a factorythe size of ECW would have been far better to cope with the low demand for buses in the 1980’s.

  7. Well I thought the government we had now was the most bloody stupid ever, but now I’m not so sure. What on earth did the Wilson government think the effect of a credit squeeze this severe would have on the motor industry? It simply beggars belief.

    • He probably had little choice, this was the era of exchange rate controls. You couldn’t import more than you exported and the currency couldn’t be devalued easily.

      The reality was British industry was inefficient and being left behind by more modern competition from other countries. The same is true today sadly.

  8. I love this period of BMC history. How could the politicians get it so wrong (again). Short term solutions. If BMC had been allowed to reorganise, launch the revised ADO16, the new Mini (cheaper to build) and the booted Morris Maxi the company would have generated cash for the new small Jaguar and maybe the Pinifarina rebodied 1800 and 1100 Aerodymamica concepts and taken BMC into the 1970’s. A rear drive better Marina might still have been needed for the fleet market to repalce the Oxford/Cambridge. What lifts me is that GREAT BRITAIN still had a chance – we were in the race and BMC was the 5th largest car manufacturer in the world. Now MG sell 9 cars in February! OK Mini and JLR are doing really well but are foreign owned which gives us risks for the future. I have a copy of the Leyland Papers written in 1971. If anyone is interested in this period it is a great read. All those clandestine meetings with Wilson Benn Harriman and Stokes at Chequers!! Great times never to come back to this declining dump of a country with no hope and no future! My opinion I’m afraid.

  9. A great piece of research there Ian! It seems I will need several readings just to digest it – any chance of a PDF to print off?

    Oddly it appears to knife that bludgeoned the British motor industry (not only our beloved firm but Rootes and GM/Bedford too) was Transit shaped. A lot of simple profit came from the commercial sections of the marques, and the Transit effectively wiped the floor here. Ironic then that come 2013, Ford has totally lost the plot with the transit, and it is (Transit) a marque with many vehicles sharing the same name – none of which are loved by the customers!

  10. BL had some good profit makers on the truck and bus side, such as the Atlantean,and Leopard, both of which to be honest were a licence to print money, and Scammell trucks which were the kings the world over for heavy hauling, and the profits from these were creamed off tho prop up the car plants, thus starving the profitable side from cash, and thanks to that, the mighty Leopard got a right royal kicking from DAF & Volvo, that did much more powerful, and better riding coaches, and the Germans muscled in with FAUN motive power units

  11. A little harsh to crucify the Allegro at the end. The ADO16 had become ever more irrelevant by the Mk3 Cortina and Escort by 1973, larger cars which made the ADO16 look less and less attractive as a new car proposition.
    Also EU crash testing was on the horizon, the Allegro was designed to meet it.
    The Marina and Allegro replaced a raft of new cars, not just the ADO16.
    – Morris Minor
    -Austin/Morris Cambridge and Oxford
    -A55 Van

    It was the profitability of the Marina and Allegro that really kept the company going as long as it did, it was brought down by an inability to reduce wages and the three day week in the end, not a reduce meant in sales as such. The Allegro was a more costly car to buy than the ADO16 as it was much better equipped ( better than much of the competition too), and this boosted profit. Combined sales of the Marina and Allegro must be considered when comparing to sales of the ADO16, the Allegeo was designed to be well out of the ADO16s league and should not be compared on a like for like basis.

  12. A fascinating piece of research and information. Great piece. Please don’t post too many items that length…..took me half an hour to read, and I should be doing other things.

  13. What a great read! Fantastic bringing together of strands of information.
    @14 KC–never mind other things –best read for ages!
    @11 Andrew–copy and paste into Word–prints out nicely onto A4–you may have to copy/paste in chunks depending on you PC’s memory

  14. @10 MG are also foreign owned. Though I see your point in that they’re the last remnant of the “volume” business, a sad footnote in history with 9 monthly sales.

  15. “On 27 April 1971 Austin Morris launched the Morris Marina. It would later assume joke status. But it must be emphasised that it was never intended to be a great car”

    Just as well then..

  16. A superbly written and authoritative blog. Well done sir!

    @11, Andrew Elphick,

    Many multi-drop drivers prefer the Transit to the Sprinter. Having done such work myself, I agree with them, alhough I much preferred the base-model Transit 100 RWD to the 115 RWD, which was ridiculously stall-prone.

  17. I hate the Sprinter. Horrid to drive and not that well made. Anyhow, BL did really lag behind with the Sherpa, which cost them dearly. In the 70s all you could get was 1 wheelbase, and a choice of petrol or diesel. The Tranny, well, you could have it how you wanted it, right up to a V6 petrol

  18. The author replies.
    I wrote it because I felt the ‘Leyland Papers’ version has been accepted as the truth for far to long.
    ‘The Leyland Papers’ portrayed Lord Stokes as the man who saved the British motor industry, when the reality was that he was a brilliant salesman who over over reached himself.
    Credit squeezes were instigated periodically by central government, often to take the heat out of the economy and reduce imports. I think it was Charles Griffin that commented that government wanted the motor industry to expand, but would then put put the brakes on the economy so that there was no market to expand into.
    Another thing that narked me off was the way politicians and analysts exhorted the British motor industry to build a reliable and mechanically simple car i.e backward, in the naive belief that the market would take these products ad infinitum. Well BLMC produced the Morris Marina with a target production of 5,000 per week. It only briefly reached this in 1972/73 and then dipped back to 4,250 and below. In this period Filmer Paradise made ludicrous predictions of selling 300,000 Marina’s a year when peak production was 201,000 in 1972/73. There were simply not enough customers out there for this type of car.
    It appears BMC were making money on the Mini and ADO16 when faced with an unrestricted market and able to produce to maximum capacity. It was when confronted with credit squeezes such as late 1966 and a poor car market, such as 1969/70 that the low profit margins were eaten into by fixed overheads.But BMC could produce them in large numbers most of the time because people wanted to buy them.
    As for the Austin Allegro. Yes I was hard on it, but the sales statistics don’t lie.
    It was Jeff Daniels that saw the ADO16 as a Ford Cortina competitor, and yes the MK3 Cortina outgrew the ADO16, but the BMC car was the originator of its own class, which Volkswagen designed the Golf to compete in.
    The ADO16 was only irrelevant when there was something better on the market.
    Was the Allegro profitable? £25 million was a lot of money to spend for a 5.3% UK market share at best.
    Longbridge produced the Allegro at half the rate of the ADO16 while retaining the same fixed overheads.
    Keith Hopkins the PR man, left BL in 1978. In 1984 he formed the PR firm KBH Communications, which he then sold on to Lord Bell in 1995. One of the directors of KBH Communications from 1987 to 1995 was Lord Stokes, who first met Keith Hopkins when he was at Standard Triumph in 1961.

  19. Great article – I love the history sections of this site.

    In defence of the Leyland Papers, Stokes’ weaknesses weren’t so obvious in 1971, becoming clearer as the company became so obviously unviable. There’s a comment in that book from the early 60s to the effect that ‘Thank goodness there was Donald, because there really was no on else’. In 1968 there also Edwards, but the idea of the company being run by joint MDs was a recipe for indecision and weakness. A pity they couldn’t work togther though.I’m also uneasy about Stokes being MD and Chairman – too much control, too few checks and balances. A separate Chairman, to ask questions of the MD, is surely a more sensible model.

    BMH had plenty of problems – piece work being a key one, especially once the unions had been provoked into striking following the credit squeeze. It’s true to say that the squeeze would weaken the home market, but the idea was surely (via devaluation) to strengthen export markets. The establishment of the Lausanne base was clearly aimed at that too, but the cars weren’t really good enough, I suppose.

    The Austin 3-Litre was a strange forerunner for a small Jaguar – and the idea that a small jaguar could be so heavily based on BMC parts is strange. May as well have called it a Riley or a Wolseley.

    Yes, BMH did have more new cars up its sleeve than Stokes acknowledged. 9x and it’s longer sister were among them. Maybe the longer 9x could have replaced ADO16, and as you say ADO16 did have a few years’ left in it. Chris Cowin’s recent book suggests that 9x would have needed to be sold at too low a price, however, because it would have been perceived as smaller and more basic than the R5 and 127 which would have come out at the same time – and yet it may have cost as much to build. The same would apply to the bigger 9x and the Golf, I guess. So the problem of low profits on mass market models would have continued. Not sure that a range of 9x, bigger 9x and Maxi is a very convincing one in that light, although all were excellent examples of space-saving engineering. By the early 70s people were buying bigger cars (eg Cortina) and BMH may needed to have a Marina-type vehicle too, but if they’d launched the Morris maxi saloon I wonder how keen they would have been to follow it up with a ‘Marina’ in a similar market slot.The problem with the Maxi was poor execution of a sound design. Maybe that would have applied to 9x too?

    Final point: Tony Benn is a key figure in the history of BL in 1968 (his diaries talk of the merger talks stemming from a meeting at his house in 1966), and again in 1975, when he commissioned the Ryder report. Both ventures were aimed at expanding the UK industry, perhaps against the wishes of those who were running the company. Harriman’s comment that ‘when a PM asks you to do something it’s not advisable to say no’ is telling, and shows the influence of politicians over management. Thank goodness Governments are more deferential to business managers today.

  20. Another vital thing lost with the departure of Roy Haynes was a man accustomed to working to a budget and the tricks used to make sure vehicles remain on budget.
    Take the rear lights on the Marina, it used a chrome plated plastic surround instead of Mazak, stainless or played brass to save money. Money saved there could be added to another area of the car and so on.

  21. It also needs to be remembered that Leyland Motors (Rover, Triumph and Alvis) also greatly suffered from the merger. They had the makings of what JLR are achieving today. Range Rover was launched by Stokes in 1970 but not developed further until the 1980’s – could have been a huge money spinner and sold in the USA. Rover cancelled the P9/10 which had already been developed and tooling ordered so not to compete with Jaguar XJ6. The P6 Alvis Coupe and drophead was also cancelled. Triumph had additional versions of the Stag, and eventually SD2 got cancelled. SD1 had an estate cancelled and the Triumph TR7 Sprint was cancelled as was the Lynx. Leyland motors although small could have been very profitable selling 300,000 vehicles a year not bogged doen by BMH. If the maeger had not happened where would we be now – just one decision can affect thousands of people and the whole country. Makes you think. If the IRC had stepped in to save BMH in 1967 and lent it enough money to develop face lifted models and a better Marina things could have been different in the 70’s especially id Joe Edwards had reduced the workforce by 30,000.

  22. Leyland protectionism of various parts of its empire ultimately affected the company as a whole. The Stag V8 and Dolomite Sprint engines could and should have been used elsewhere but were not.
    Infact the Dolomite Sprint engine could have formed the basis of a range of high power output DOHC units from 1300cc to 2000cc, but Stokes and Co. especially Harry Webster would never agree to that.
    The Marina was a compromised design due to poor decisions, the TC could eat the old Herald single rail gearbox for lunch as the gearbox was simply not upto the job of hauling a car with the weight and torque of the TC. Really an MGB overdrive gearbox should have been used, but was not due to both cost and resistance from MG management, a shame because the overdrive option could have made it more sellable in the states.
    The list goes on, and let’s not even talk about the Force 7 Coupe, what a total waste that turned out to be.

  23. Top notch piece of writing, getting to the heart of the problems that eventually lead the BMC family to collapse in 1975.

    From a presentational point of view I think it needs to be split over several pages. My Firefox web browser struggled to read the whole thing in and I had to swap over to IE.

    My mind is made up about Stokes – he was part of the problem not the solution. It was him that apparently made the final decision about the styling of the Allegro and TR7 and chose them because they were “different”. He also pressed on with the launch of the flawed Maxi and 3-litre instead of re-engineering or canning them. All those cars were doomed by terrible styling as well as bad engineering although the engineering was cleaned up in later life.

    The debate over the Allegro will rage forever. If only they had the foresight to produce an equivalent to the Simca 1100 (hatchback) which had been around since the late 1960s, well before the Allegro was signed off for production.

  24. @25, Marinast,

    I don’t see why the Triumph V8 should have been used instead of the Rover one- the Triumph had woeful unreliability and used up valuable development funds when the group already had the excellent and reliable ex-Buick V8.

    As for the Dolly Sprint engine- wonderful unit dogged by quality control issues- not to mention servicability issues, as mechanics weren’t used to working on alloy heads over iron blocks. Ok, not insurmountable, but look at the problems there have been more recently with the K Series, with mechanics often misdiagnosing problems, fitting the wrong ‘cure’, or not fitting appropriate replacement parts.

    So I think that your suggestion would have caused far more problems than it would have solved.

  25. The early Sprint engines were excellent units, nitrided cranks, properly cast cylinder heads. Later engines were cheapened and cylinder heads often had traces of sand inside due to corners being cut. Yes many did not know how to work on them, but that is simply down to ignorance. The Allegros wheel falling off trick is true, as long as the mechanic works on the rear wheel bearing as he would on an ADO16, cue warning stickers fitted to later Allegro rear drums.
    The Stag V8 could have been used on other models but it did need much revision to mke it reliable but a 32 valve version was planned, just imagine that in a Rover or small Jaguar.

  26. This is an AMAZING blog. Exceptionally researched and written. Always wonder what would have happened if BMC had really got to grips with rationalisation after the 1952 merger and really focussed on getting industrial relations right. Particularly hard to read about how all of this affected George Harriman, even if he was part of the problem.

  27. Sir George Harriman was man enough to share power with Joe Edwards.
    I feel the Leyland men behaved disgracefully in demanding his removal from the BLMC board.
    Sir George Harriman behaved in a gentlemanly manner over his dismissal and appears to have declined to give his version of the story in the remaining years left to him

  28. A great piece and a compliment to the Leyland Papers, I must say I find this part of British Motor Industry history very interesting. I still feel there are many stories still to be told. I am left with the feeling that once again old Len and his famous rows had a far reaching effect. Perhaps, if he had not fallen out with Joe Edwards in the ’50s, then perhaps Joe might have succeeded him in 1961, so avoiding the Harriman years. The work Joe started in the late 60s would have been started earlier and BMC would have been leaner and a much harder target for Leyland. A strong BMC with Edwards at the helm, could well have told the IRC where to go and Stokes with them. Arr What if…

  29. The sad thing is when British Leyland was created it had 40 per cent of the market, was one of the biggest players in the world, and many of its products were widely respected and popular. Ten years later the company seemed to be in terminal decline, with terrible industrial relations, awful mainstream cars and even its specialised cars like the Jaguar XJS were a reliability disaster. I think the creation of such a huge corporation with all the internal rivalries, a large part of which ( BMC) was ailing and the successful part( Rover, Triumph, Jaguar and the commercial vehicles) was dragged down was British Leyland’s undoing.
    To be cruel to be kind I would rather have kept Leyland and BMC seperate and should BMC have faltered, then it was their own fault for cars like the ADO 17 and the Austin 3 Litre. Maybe the Mini and an updated ADO16 would have had a future, but the bigger cars were becoming a joke by the late sixties.

  30. Someone mentioned earlier the Marina wasn’t intended to be a great car, probably the root of most of British Leyland’s problems as it would be a bit like Volkswagen producing the Golf with Beetle engines rather than totally eradicating the Beetle’s DNA from its cars from 1974 onwards and making a world beating small hatch.

  31. This is a great article – well done and thank you for all your work and research.
    When I read some of the responses I am just slightly concerned that the comments about BMC and later cars group cars being so ‘bad’ are made by those too young to remember them in context.
    They were not THAT bad considering what else was available (from the UK). The Avenger and Hunter were not the most inspiring things to drive, the Mk 3 Cortina rusted (much as I loved them) nearly as fast as an Alfa Sud, although to be fair Vauxhall did have the well sorted HC Viva and FD Victor. In fact, once the Marina was sorted (pre Ital), it was good fun to drive and my 1.7 was reliable, spacious and capable – gearbox apart.

  32. Wolseley Man, surely the FD Victor was a bigger ruster than a Cortina. Yes it was a nice looking car and good to drive, but it wasn’t very well made and rusted badly, hence why most of them were scrapped or bangers by the end of the seventies, where most Mark 3 Cortinas were still running well.

  33. Very good article on the BMC/Leyland merger.

    On the last two posts regarding the Ford Cortina Mark 3 and the Vauxhall Victor FD, the Victor was in many ways a better car and more comfortable to ride in, they looked quite similar too, it has to be said the FD Victor came out about 66/67 compaired with the Mark3 Cortina being introduced about 71, this would explain why many Mk3 Cortinas were still on the road by the end of the 70s, they were made until 76, the FD Victor was made till about 71, rust wise both vehicles were much about the same, even though the Victor felt more substantial, the bonded windscreen on the Victor was prone to leaking, this was a major cause of corrosion on this model, the Cortina rusted in the usual areas, front valence, wings, sills, both vehicles were mechanically sound though.

  34. Stokes was a salesman, a very good salesman and if he had charmed Tony Benn into believing that all BMH needed was Leyland management to take over the larger company, well that point is not documented.
    I wonder did the Wilson Government even bother to take a hard look at Donald Stokes credentials or were they taken in by a successful salesman?

    Either way the redundancies were passed over so BL was born overweight and neither management or the government were willing to bite the bullet.
    The unwillingness to rationalize the workforce and another, ‘what if’ must be; What if Roy Haynes was taken by Leyland from Ford?

    Seems like because he was a BMC recruit was ignored. Did those shower of Leyland chancers not consider the fact that Roy Haynes created the car that knocked the 1100 out of first place?
    More evidence that would point towards the IRC having given Leyland management approval to do as they wished with BMC’s management.

    So Leyland thought the Allegro and Marina could compete with Fords and GM’s of the time. Says it all.

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