History : The Edwardes Era – Part Two

Ian Nicholls, AROnline’s historian-in-residence, recounts the history of BL under the leadership of Michael Edwardes. He follows up his excellent rundown of the British Motor Holdings and British Leyland stories with a seventeen-part study of the firm from 1977 to 1982. 

Here, in the second part, we look back at the onset of 1978 – the midst of a new model drought, and declining market share – and the growing list of tasks being added to Edwardes’ already bulging inbox…


Sir Michael Edwardes
Sir Michael Edwardes

January 1978 began with British Leyland strenuously denying it had made any decision to close the Triumph Speke plant, as rumours spread of imminent action. The strike had now entered its second month, with local politicians making frantic efforts to allay fears of closure and strike leaders accusing management of using the weapon of fear to break the will of the workforce.

Meanwhile, over at Cowley, Alan Thornett, the Shop Steward known as ‘the Mole’, stood down from the post at the car assembly plant to which he had been elected. His decision made a confrontation over the company’s refusal to recognise him as a Deputy Senior Steward for the Transport and General Workers’ Union less likely.

Alan Thornett was told when he tried to assume his new union duties that he would not be recognised by the management. A meeting of the union’s leaders at the factory had decided to leave the controversy in the hands of union officers and to give British Leyland until 1 February to reconsider.

Rumours rooted in reality

On 5 January, the media reported rumours that Derek Whittaker, the Managing Director of Leyland Cars, was also going to follow Alex Park through the exit door. Other rumours were leaking out of British Leyland.

It was reported that Michael Edwardes wanted to produce two versions of the Mini, side by side at Longbridge – the now-classic ADO20 model and a larger version of its proposed replacement, the ADO88, which became the LC8 Metro (below).

There was a considerable body of opinion within Leyland Cars which had long advocated a two-model approach. It argued that the new generation of small cars – such as the Fiat 127, Ford Fiesta, Renault 5 and Volkswagen Polo – were so much alike that they had given a new lease of life to the 18-year-old Mini.

The new Mini (ADO88) would morph into LC8 Metro, following Ryder recommendations

All were some 18 inches longer than the ADO20 Mini and so similar in appearance that the much smaller box-shaped British car was gaining a certain cachet as something different. Certainly, it had outsold the new Ford Fiesta by two to one – taking 5 per cent of the British market in 1977.

The AD088 was about nine inches longer than the existing Mini. Its advocates chose to make it considerably smaller than foreign rivals in an attempt to avoid a head on clash with cars which would be firmly established by the time it appeared in late 1979 or early 1980.

Opponents, now supported by Michael Edwardes, insisted that, on the contrary, it would fall between two stools and lose its image. This view was vindicated by the results of the styling clinics.

Edwardes hits back

Michael Edwardes responded to these rumours the following day. He announced a series of union consultation meetings. He pledged that all workers would be kept fully informed of major decisions. In a message to Leyland Cars workers he said he hoped to put the 1978 ‘action plans’ for the car company to a full participation conference early in February. At the same time he stressed that the debate with employee representatives could not be prolonged and warned all workers only to rely on information issued by the company.

In his message, his first major public statement since becoming Chairman in November 1977, Michael Edwardes strongly reacted to reports about the future of the Mini replacement and of some plants, particularly the strike-hit Speke factory at Liverpool. He said that many statements made by the media about British Leyland would seem to come from uninformed sources ‘and an excellent example of this was the mischievous reference to a decision having been made to close certain plants or locations. No such closures have yet been decided upon.’

Edwardes also disclosed that the group’s new Advisory Board, including Alex Park and Derek Whittaker both of whom had resigned, had arrived at ‘various tentative but unanimous conclusions’ about the future of Leyland Cars.

Into a consultation period

During a period of consultation with various parties no statements were expected to be issued to the media ‘for the internal debate is the private business of employee representatives and management.’ The next formal statement would come at the time of the participation conference.

‘In the meantime you can rest assured that your representatives will be consulted on major decisions which affect you. The only information upon which you can rely is that issued by the company.’

Michael Edwardes said the company was reviewing policy to ensure that capital spent on new models was well spent. This would involve modification to certain existing programmes including the modified AD088.

Union unrest at Whittaker’s departure

Three British Leyland white collar unions deplored Derek Whittaker’s resignation as Managing Director of Leyland Cars. The unions said on behalf of their joint 18,000 staff members in Leyland Cars, that his resignation was taken as ‘further confirmation of basic differences’ between executive management and Michael Edwardes.

The three unions were the Technical and Supervisory Staff Section of the Amalgamated Union of Engineering Workers, the Association of Technical, Scientific and Managerial Staffs and the Association of Professional, Executive, Clerical and Computer Staff. They said they condemned the climate into which Leyland Cars had been pushed by the silence surrounding Michael Edwardes’ examination of it. They reaffirmed their determination to oppose any reorganisation aimed at diminishing Leyland Cars’ activities, reducing jobs or hiving off parts of the company.

According to The Times, the sudden resignation of Derek Whittaker, the Managing Director of Leyland Cars, was because of Michael Edwardes’ determination to reorganise the struggling company and break it into smaller, more manageable and more easily accountable units.

Splitting British Leyland into three

If the intention had been to create subsidiaries controlled by a central Leyland Cars Board headed by Derek Whittaker, he would have been prepared to continue. However, the proposed creation of three quite independent car companies for volume cars, specialist cars and parts would have effectively demoted him to the post of Chief Executive in one of those companies. It was now known that Derek Whittaker had offered his resignation early in December 1977 at about the same time as Alex Park.

Derek Whittaker had won the respect and loyalty of his management team by total consistency in the face of labour disputes and his determination in resisting pressures from his political masters.

Michael Edwardes’ announcement of Derek Whittaker’s departure was at variance with Derek Whittaker’s own views as expressed to colleagues.

‘Over the past three years Derek has had what some would regard as the unenviable task of having to wrestle with a host of formidable problems.’ – Michael Edwardes

Michael Edwardes’s statement said: ‘Early in December Derek Whittaker indicated to me that he would like to broaden his industrial experience and take a job outside Leyland. We agreed that he would not leave Leyland Cars until 31 January. Over the past three years Derek has had what some would regard as the unenviable task of having to wrestle with a host of formidable problems.

‘Unfortunately, even the successes like the Rover SD1‘s Car of The Year award, to name but one, have been overshadowed by the very real difficulties which continue to face the Leyland Cars company. Derek is being closely involved in the current reorganisation of British Leyland and the options now being looked at for cars reflect much of his thinking and have his general support.’

Michael Edwardes paranoia about the press leaks emanating from British Leyland resulted in the employment of legal eagles Lord Goodman and Brian Neill QC to investigate where the media were getting their stories from.

‘Red Robbo’ states his objections

On 8 January, the Chairman of the British Leyland (Motor Corporation Combined) Trade Union Committee (BLTUC), Derek Robinson (below), criticised the British Leyland Chairman over alleged press leaks of a plan to cut the workforce by up to 30,000.

Derek Robinson accused him of revealing the plan to certain journalists before any consultations with Shop Stewards, and said it was done deliberately to confront the Trade Unions, and the Government, with a fait accompli. British Leyland said there had been a ‘breach of confidentiality’ by journalists who had been invited only for private ‘briefings’ on Michael Edwardes ideas of British Leyland’s future development.

Derek Robinson said the Trade Unions expected to be consulted fully on any new plan. There was specific machinery and they expected Michael Edwardes to use it. ‘If it means we have to go into conflict with him to exercise our rights, then we shall have to go into conflict with him ‘, he said.

Derek Robinson

Press briefings cause tension

The Trade Unions had known the press briefings were taking place. He said the leaks were ‘quite deliberate on his part. It seems to me he is not only going to confront the unions with a fait accompli, but also the Government.’

British Leyland also denied Sunday newspaper reports that Michael Edwardes planned to cut one in four jobs in the car division, both white-collar and shop- floor. A British Leyland spokesman said: ‘We issued a statement to workers on Friday that no decision had been made in closures.’

However, later a spokesman said the reporters had ‘gone much further’ than British Leyland expected in reporting information given at the briefings. ‘There was a breach of confidentiality by some, not all – but we still believe the briefings are necessary,’ he said.

Money troubles

On 10 January Eric Varley, the Secretary of State for Industry, disclosed that British Leyland had negotiated temporary short cash facilities from commercial lenders to help to meet its cash requirements. This was the £80 million loan Michael Edwardes had obtained from three banks.

By now, Ray Horrocks had taken over the management of Leyland Cars. On 12 January, he outlined the new British Leyland management plans for the car division to Shop Stewards.

The following day 120 Shop Stewards met in Coventry and came up with their own plan to save the ailing car firm. They opposed the management’s move to lose 12,000 jobs by natural wastage and voluntary redundancy. But in return they offered to get a commitment from the 132,000 workers to do everything in their power to cut out strikes.

Longbridge 1980

A million a year in 1979?

They offered to produce a million cars by the end of the year, that was 150,000 more than the management’s target. Derek Robinson said: ‘This is not a fairy story. It’s true we have no magic wand, but I am sure we can get these commitments from the shop floor. The unpalatable alternative is for the men to accept the management’s own plan and the redundancies that go with it.

‘I am sure they will agree – if it means no redundancies and fewer strikes. Our aim is to safeguard jobs. We should not need to have instant strikes like instant coffee.’

Derek Robinson was confident that, given the shop floor commitment, it would be possible to exceed production targets based on existing manning levels. ‘We don’t see the management’s plan as our salvation. It is based on a philosophy of despair and defeat.’ In the next week Shop Stewards would ask workers in all plants for the ‘utmost cooperation towards industrial peace,’ he added.

Asking for Ryder Report money

The following day Michael Edwardes wrote to Sir Leslie Murphy, the Chairman of the National Enterprise Board, on the subject of the £1 billion allocated to British Leyland by the Ryder Report.

‘The British Leyland Board, however, feels strongly that a new approach to the provision of funds is required,’ he said. ‘The financial state of the company is such that, even though the Plan is expected to show the prospect of reasonable levels of profitability in the 1980s, the Board cannot recommend making the investments necessary for the 1980s without firm assurances of Government financial support.

‘The Board believes that the linking of financial support to day-to-day industrial relations performance is unhelpful in the running of the business. Furthermore, going from cash crisis to cash crisis will severely inhibit our ability to attract high calibre managers or to hold our best people. What is needed now is a Government assurance that there will be adequate equity funding in the future, in addition to the funds that need to be provided at the latest by end March.’

Spelling it out to the workforce

On 16 January, national union officials and senior Shops Stewards from Leyland Cars’ 30 manufacturing centres met the British Leyland Chairman in London to hear details of his plans. According to contemporary media reports this meant reorganising Leyland Cars and cutting 12,000 jobs.

By all accounts he was given a rough ride and his proposals to decentralise the group met with outright opposition from several Trade Union leaders. One union official described the plan as ‘piecemeal slaughter’ of the group.

Both sides agreed not to make public details of the talks, but several union leaders ignored the agreement. John Rowan, National Officer for the Technical and Supervisory Section of the Amalgamated Union of Engineering Workers, said of the Edwardes plan: ‘They are going to chop Leyland up so that its enemies can pull it to bits. Mr Edwardes’ recipe for success is to go back to where Stokes and Barber left off, back to Austin Morris, back to Rovers, Triumph and Jaguar, the very structure which failed so abysmally in 1974. Leyland is being chopped into smaller blocks so that its enemies can pull it to bits piece-meal.’

A poor reaction to Edwardes’ plan

John Rowan said British Leyland was too small in international terms and to make it smaller would weaken the company. ‘And behind that assassination are tens of thousands of jobs in Lucas, GKN and Rubery Owen’, he said.

Ray Edwards, Assistant General Secretary of the Association of Professional, Executive Clerical and Computer Staff, which had 8000 members within Leyland Cars, said there would be strong union opposition to the creation of a new Land Rover/Range Rover company. He felt that because this section was profitable and had large export markets, particularly in the Middle East, it would be a prime candidate for hiving off to private enterprise.

Michael Edwardes was said to have told the Trade Unions that British Leyland in its existing form was unmanageable and that his predecessors had had an impossible task. He said that he was aiming for a cut of 12,000 jobs before the end of the year, most of which would be achieved by natural wastage. This was based on a projected output of 850,000 to 890,000 vehicles this year. Among other projects apparently being reviewed was a computer centre at Redditch which would link all Leyland Cars’ operations. Despite Michael Edwardes’ statement on the loss of jobs, union leaders feared that the total might be nearer to 30,000.

Talks with Renault commence

Michael Edwardes had said that the proposals had to go through a series of participation meetings and would be discussed at a conference between management and workers’ representatives on 1 February before being submitted to the National Enterprise Board and the Government.

In a brief statement the Chairman said the meeting reflected the participative style developed in British Leyland, which he strongly supported. The union leaders were also told that British Leyland was negotiating to build a foreign rival’s cars in Britain. The rival was the French nationalised Renault concern, seen by many on the left in Britain as the role model for a state-owned motor manufacturer.

During January 1978 Michael Edwardes and David Andrews, the head of Leyland International, had visited Paris at the invitation of Sir Nicholas Henderson, the British Ambassador to France. They had dined with the Chairman of Renault, Bernard Vernier-Paillez and his Deputy, Bernard Hanon. Michael Edwards omitted details of the 16 January meeting with the Trade Unions from his memoirs, ‘Back From The Brink.’

That same day at a Paris hotel, away from the media spotlight, Leyland Cars held another styling clinic (below). Alongside a Fiat 127, a Ford Fiesta, a Renault 5 and a Volkswagen Polo, Leyland Cars displayed its heavily revised ADO88 design now recoded LC8. The reviews for LC8 at this clinic and at Rotterdam later in the month were positive and the LC8 formally replaced the ADO88.

LC8 styling clinic

Trade Unions talk British Leyland with the Government

On 19 January national officials of the motor industry unions met Eric Varley, the Secretary of State for Industry, to express their disquiet over proposals by British Leyland to reorganise Leyland Cars and cut jobs. The Trade Unions had requested urgent meetings with the Prime Minister and Eric Varley.

The British Leyland unions left Eric Varley in no doubt that whatever arrangement finally emerged to hoist Leyland Cars out of its crisis, it could not be achieved at the expense of jobs. They were not openly hostile in resisting the ideas of Michael Edwardes, the British Leyland Chairman, to split Leyland Cars into smaller groups, one for executive and specialised cars, one for volume cars and a parts section, together with a separate organisation for the lucrative Land Rover side of the business. Eric Varley, who met the Trade Unions at the Commons, gave no concrete undertakings.

The Trade Unions said they would be against Michael Edwardes’ apparent desire to see Leyland Cars drop 12,000 workers by the end of 1978, a figure that some union leaders believed would in reality be more like 30,000 to 40,000 to accommodate his plans completely. Grenville Hawley, the TGWU’s national officer for the Motor Industry, said the unions wanted Eric Varley ‘to understand our self-centred view’ about the British car industry. A statement from the Department of Industry said Eric Varley reiterated his desire to see the company succeed.

In a weekend interview, Eric Varley, the Secretary of State for Industry, said: ‘We have to have a strategy for British Leyland which will arrest the decline and put it on a sound footing. I support Michael Edwardes in his approach. There’s no way you can force people to buy Leyland cars. They will only do so if the products are equal to or better than the competition.’

Getting Government approval

Before any reorganisation could take place, Eric Varley would have to win Cabinet approval, and he admitted that he would have to educate elements of his own party that market forces made the car industry different from monopoly state industries, in which jobs were also at stake.

He said: ‘I am amazed that the Labour and Trade Union movement has not yet really understood this. We aren’t talking about water boards or electricity supply, but manufacturing industry in the most fiercely competitive market.

‘I am sure that this is not fully grasped on the shop floor. British Leyland is going to be managed by the management, not the Government. We will be kept informed. We haven’t the resources in the Department of Industry to manage Leyland and there is no desire on my part to do so.’

Eric Varley had hit the nail on the head.

The strikes of 1978 begin

Starting on 23 January, there was a series of mass meetings at all 35 Leyland Car plants, at which the Shop Stewards asked workers to endorse their opposition to Michael Edwardes’ proposals.

According to preliminary soundings taken by the Shop Stewards, they would receive overwhelming support for a campaign to stop the redundancies. Independent sources in the industry also agreed that there would be a sizeable majority in favour of outright opposition.

Semi-official sales returns for the first 18 days of January 1978 showed that Leyland Cars’ share of the British market was continuing to fall despite record stocks in its dealers’ showrooms. Returns based on reports from Leyland Cars own sales network pointed to a market share of between 20 and 22 per cent.

Car sales start to flounder

And the excuse so frequently offered by management was no longer justified. Throughout 1977 it blamed strikes in its own and supplier factories for keeping Leyland Cars dealers short of cars.

Now, with admitted stocks of 100,000 cars, and industry sources put it as high as 130,000, they were still losing out to Ford, Vauxhall and importers like Datsun. Harry Urwin of the TGWU was being proven right.

Much of Leyland Cars’ deterioration was attributed to its increasingly unattractive ‘bread and butter’ family saloons – the Austin Allegro and the Morris Marina. The group urgently needed a new or facelifted contender in this sector.

The following day production of the Rover SD1 was stopped by a dispute over the condition and colour of a few pairs of workmen’s overalls. Six vehicle Inspectors walked out at the company’s Solihull plant saying that they had been issued with brown paper-based overalls instead of the white cloth ones that they insisted were the normal allocation for their job. Forty other Vehicle Inspectors stopped work in sympathy. It made the headlines.

More resignations

There were two more resignations from Leyland Cars on 26 January. They were Geoffrey Whalen, who was the company’s Director of Personnel and the master mind of new pay determination arrangements, and Keith Hopkins (above), Director of Sales and Marketing.

Geoffrey Whalen had joined British Leyland from General Motors via the National Coal Board in 1970. He would go on to manage the remnants of the Rootes Group in the form of Peugeot Talbot and received a knighthood.

Keith Hopkins had been Lord Stokes ace public relations man. However, with Michael Edwardes ex-Chloride man John McKay now in charge of Public Relations, there was no room for a man of Keith Hopkins skills in British Leyland.

Hopkins: a great loss to the business

In my view, Keith Hopkins was probably the best executive that Lord Stokes had drafted into the newly-formed British Leyland in 1968. His positive spin of events and manufacture of Lord Stokes as a media personality were very effective in papering over the substantial cracks. His protege David Boole would later do the same for Jaguar and its Chairman in the next decade.

In 1984, Keith Hopkins founded KBH Communications (KBH), which listed The All England Lawn Tennis Club and Classic FM among its clients. The Chairman of KBH Communications from 1987 to 1995 was none other than Lord Stokes.

In 1995, Keith Hopkins sold KBH to Sir Tim Bell’s PR firm Chime Communications and merged it with Lowe Bell Good Relations (LBGR). Hopkins became Deputy Chairman of LBGR. Keith Hopkins died in 2006.

A management reshuffle ensues

In a short statement British Leyland said that, pending an announcement of re-organisation, temporary appointments would be made at Leyland Cars. Trevor Taylor would be made responsible for sales and marketing. Bill McLean, the company’s Director of Employee Relations, took over extra responsibility for personnel policies and planning, while Gordon MacFarquhar, the Director of Organisation and Management Planning, assumed additional responsibility for employee services and training.

On the same day as these departures, the Prime Minister, James Callaghan, told the Birmingham Chamber of Commerce: ‘The country has shown faith in Leyland. Now it is up to Leyland to justify that faith from top to bottom, management and workers. I say to them all: “Give yourselves a chance and give Michael Edwardes a break. Do not look to the Government for any more solutions. We have done our part. Now its up to you.” I add only one other thing. There’s not a single one of us who will not feel proud if Leyland [Cars] can succeed in becoming a symbol of all that is best in Midands craftsmanship.

‘Now the company must solve its problems. Putting public money into Leyland [Cars] is an act of faith. Are we going to be let down? I make no threats about withholding funds if targets are not met. That kind of language can lead to bloody mindedness. But I say to everyone in Leyland [Cars] that the way Nemesis will come is when you have no customers left to sell to.’

Jim Callaghan

Prime Minister defends Edwardes’ plan

James Callaghan also hit back at critics of new British Leyland boss Michael Edwardes. He dismissed complaints that Mr Edwardes had spent too much time with British Leyland dealers. Mr Callaghan said: ‘That’s what making cars is all about — finding out what will sell to the customers.’

Since the State had taken over British Leyland £350 million of public money had been pumped into the company. £200 million was spent buying up a 95 per cent shareholding. £150 million was spent on long term plans. The Government had promised a total of £1.2 billion in state aid.

British Leyland’s wage bill was running at around £790 million a year and take home pay packets accounted for £700 million. The rest went to overseas employees. During the previous ten years, British Leyland had spent over £780 million on new plants and machinery.

British Leyland was Britain’s biggest exporter. Between 1968 and 1977, the company’s overseas sales totalled £8.4 billion. That represented £130 million earned abroad for every man woman and child in Britain.

British Leyland’s energy bill – the cost of heating, lighting and driving the power tools – now ran at £1 million a week. In 1976, for instance, everything from water to electricity cost them a staggering £38,809,844.

On the last day of January 1978 Derek Whittaker officially left British Leyland. Both he and Alex Park had done their best and both would find employment elsewhere. The suspicion that they were promoted beyond their ability to be the puppets of Lord Ryder and Tony Benn will always hang over them. Why did the National Enterprise Board not headhunt a full-time experienced executive to manage British Leyland back in 1975?

Edwardes fleshes out his plans

1 February 1978 was the day of the British Leyland joint employee-management conference. The location was the Chesford Grange Hotel in Leamington Spa. In a passionate 62-minute speech the Chairman Michael Edwardes outlined his plans for the car firm’s survival to an audience of 720 people. What he said has been pieced together from various sources.

He said: ‘We have arrived at a point where we have become the standard of failure by which other lame ducks are measured. We are over-manned. Our current market share and future share, based on our most optimistic estimates, require us to reduce our workforce by at least 12,500. There is no doubt that in both the short and long term we have excess capacity. The question is not whether we should de-man, but by how much.

‘The problem must be tackled by natural wastage, redundancy programmes, by plant closures, or by some combination of these. Unless we can have active and positive support and commitment at all levels of the company, there is no point in attempting to persuade anyone that it is worth putting another pound into British Leyland.’

However, it was vital to the economy of the country as a whole that the company should succeed. Each year, its exports earned as much as Britain paid for Japanese imports of cars, cameras, television and audio equipment. It was the country’s seventh biggest employer, and the future of up to a million people could be affected by what happened to it.

There were no major surprises in the plans he outlined.

British Leyland becomes BL Cars Limited

A new company to be called BL Cars Limited would be formed as an umbrella organisation to own the assets and be the employing company for all car operations. It would control three subsidiary companies: Austin Morris Limited, for volume cars, Jaguar Rover Triumph Limited for specialist cars and BL Components Limited covering parts, foundry, SU/Butec and body operations. The car companies would resume responsibility for all their exports.

Michael Edwardes said it had been decided to retain a central cars authority because of strong and logical representations by employees for a central unit as a focus for employee relations policies.

It would ‘be wrong and senseless’ to throw away seven years work on common bargaining dates and wage policies throughout the car factories. Long-term product planning and advanced engineering – those projects between five and 15 years away – would also be central activities.

The product-led recovery begins here

A task force chaired by Spen King (above centre), the Director of Engineering, would be asked to recommend the most effective organisation for a Product Engineering Division. These central disciplines did not exist before, Edwardes continued, but as General Motors had proved over many years of successfully merging Chevrolet, Buick etc, in the United States, they were an essential part of a decentralised organisation.

Austin Morris would have major assembly facilities at Longbridge, Cowley and Abingdon as well as power train and transmission factories. Jaguar Rover Triumph would include assembly facilities at Jaguar Coventry, Rover Solihull, Triumph at Canley and Liverpool and Vanden Plas in North London. A separate subsidiary company to be called Land Rover Limited would also be established to develop four-wheel-drive business.

BL Components Limited would also bring together all the United Kingdom body operations sited at Cowley, Swindon, Llanelli, Liverpool, Castle Bromwich and Dunstable. The Managing Director-designate for the new Austin Morris company was Ray Horrocks, the former Ford and Eaton executive.

LC10 programme

Pressing ahead with the Maestro

Reaffirming his intention to press ahead with a supermini development of the ADO88, Michael Edwardes said a crash programme would also be needed to update existing models while a completely new mid-range car, the LC10 (above) was introduced at Cowley.

Leyland Truck and Bus would be known as Leyland Vehicles Limited and resume responsibility for its exports. With the loss of its export role to the new companies, Leyland International would have a much reduced task under the new title of BL International Special Products Limited, which included such fringe operations as Prestcold, Coventry-Climax and Alvis.

Aveling-Barford would become SP Industries Limited.

The Edwardes speech…

Michael Edwardes said the 250,000 vehicles lost in 1977 coupled with very bad quality had put the whole business at risk.

He said: ‘Even if we have no disruptions for the rest of 1978, our loss of market share everywhere in the world means that we will not be able to sell more than 819,000 vehicles, and that is assuming a 27 per cent share of the United Kingdom market, whereas we look like getting only 21 per cent in January.

‘Our car operations are in a mess. Last year, we lost 250,000 vehicles through disputes.’

Rover SD1

Michael Edwardes said the Rover SD1 range summed up what was best and worst in British Leyland. He said: ‘The cars themselves are runaway winners and the envy of many in the motor business. We spent £90 million developing the car and building a brand new factory, the most modern in Europe, in which to produce it.

‘And what happens? We have some of the worst production and quality problems in the whole company. Customers are literally banging on showroom doors to get delivery. After six months they lost interest, and we alienate the customers. This is what I mean by a death wish.

‘If your objectives are the same as mine then how can it be that hundreds of vehicles can be lost in one week because managers and workforce find themselves unable to agree on overalls, while the business goes to ruin? This seems to me to be utter madness. We just can’t afford to go on tearing ourselves apart while the traditional BL customers drive cars from American, Continental and Japanese stables.

‘I tell you quite seriously that unless we can have active and positive support and commitment at all levels of the company there is no point in attempting to persuade anyone that it is worth putting another pound into British Leyland.

‘You do not sacrifice a quarter of a million cars in one year of disruption and then expect your customers to be waiting patiently at the end of it. Customers mean jobs. Government aid is no substitute. The choice is stark. If the customer doesn’t support us, the Japanese will export their cars and their unemployment to Britain. No one will have a grain of sympathy for us if we act like a great dinosaur.’

Pat Lowry

…followed by a standing ovation

At the end of the speech Michael Edwardes was given a standing ovation and then Pat Lowry (above) asked the meeting to vote for a resolution pledging full support for every aspect of his programme. Only five hands were raised against. One of those who voted against was David Buckle of the TGWU Oxford District who regarded Edwardes as being an autocrat who believed in authoritarianism not mutual consensus.

Maybe David Buckle was right in his assessment? By Michael Edwardes’ own admission, one of the task groups he had set up, the Cars Operating Group, had voted 12 to 1 against the centralised Leyland Cars structure being broken up. Despite this, the Chairman had told the large Leyland Cars Board to most members dismay that it was being broken up anyway.

One of those who publicly backed Michael Edwardes was Derek Robinson, the Longbridge Convener and Chairman of the BLTUC. Another was Ray Edwards, Assistant General Secretary of the Association of Professional, Executive Clerical and Computer Staff, who only days before had criticised the Chairman in public, but who now felt that support from the Parliamentary Labour Party was waning.

‘It was a gamble which could have ended in disaster. So long as he left the issue open he was safe; but he chose to make an issue of our support, and he won,’ a senior union official said.

A ‘frank message’, well received

Cowley Shop Steward, Roy Fraser, said: ‘He sold a frank message and pulled no punches. He is a man of determination and I feel he is just what we need. We cannot ignore him.’

Afterwards, justifiably full of a sense of achievement, Edwardes said. ‘This was an historic day.’

However, Michael Edwardes’ honeymoon with the labour movement would not last.

On 3 February, the British Leyland Chairman, announced four more senior appointments to reinforce the management team at BL Cars and its subsidiaries, depleted by recent resignations. The most significant was an American, William Pratt Thompson, who was named Managing Director-designate of British Leyland’s newly-created Jaguar Rover Triumph Limited. Mr Thompson was Deputy Managing Director of Bowthorpe Holdings, the Crawley-based electrical component manufacturers. He joined Bowthorpe in 1975 from AMF Inc. to develop their overseas markets.

Another outsider was John Hirsch who was announced as the Director of Product and Marketing Strategy for BL Cars, the central holding company for Austin Morris, Jaguar Rover Triumph, and BL Components.

Retailing reshuffles

The closure of the existing central sales and marketing set up based at Redditch, Worcestershire, would have left a gap between the manufacturing companies which would in future handle their own sales, and those distributors covering the whole Leyland Cars range. John Hirsch, with a small support team, would be responsible for the development and maintenance of franchising and marketing policies for all marques.

He had a considerable track record, most of it with Ford, but also for the previous four years as Executive Director in charge of the Lex Group’s motor business. John Hirsch was of British extraction but born in Munich, he had an American wife. He spoke French and German fluently, he joined Ford Britain in 1954, as an export sales representative and was subsequently Managing Director of Ford Switzerland, Marketing Plans Manager for Ford Europe, and finally Sales Director of Ford Germany.

David Simpson, the old Leyland Cars company’s Director of Manufacturing, was appointed Managing Director of Pressed Steel Fisher, the BL Components subsidiary which would handle all car body production. He would be in charge of plants at Cowley, Swindon, Llanelli, Liverpool, Castle Bromwich and Dunstable. Harold Musgrove moved from the commercial vehicle side of the business to become Director of Manufacturing at Austin Morris.

These new appointments were announced at the Wembley Conference Centre in London where Michael Edwardes faced 2,000 dealers who sold British Leyland’s products throughout the country.

Looking after the dealers better

Accompanied by many of his new executives, including William Pratt Thompson and John Hirsch, Edwardes admitted that the company had not always looked after the dealers’ interests properly. Poor deliveries and inadequate quality was not the way to motivate the distribution network and win public support. But after admitting British Leyland’s faults he took an equally tough line with the dealers for ‘attributing the shortcoming in your own service bays’ to the manufacturer.

‘In the current climate of Leyland-bashing, the customer will almost certainly swallow the explanation that it is the fault of the factory. It may get an irate customer off your back for a while, but in the long term it won’t help you or us in our joint objective of getting customers back into the showrooms,’ he added.

For the second time in a week Michael Edwardes received a rousing ovation after outlining his plans for putting the ailing car company back on the road to recovery. The dealers gave him two standing ovations and a four-point pledge of support.

Henlys 1980

‘Wholehearted support’ from dealers

Michael Stringer, Chairman of Leyland Cars Distributors’ Council, said after the conference that the dealers would wholeheartedly support Michael Edwardes and would be selling the real merits of British Leyland cars and countering misinformed critics. Dealer staffs would ‘adopt and keep’ a more positive approach to customers and would help British Leyland to regain its ‘historical market leadership’.

He added that there was a strength and depth of feeling in the dealer network which should not be underrated.

‘If Michael Edwardes gives us the right products in the right quantity, then we will certainly put Leyland back on the map. All the forecasts show that the 1978 new car market is going to be buoyant and total sales may top 1.5 million units. For the first time since 1971 we have a good stock of Leyland’s volume cars, and we intend to play our part in regaining market share and winning the confidence of the public for British Leyland cars’.

The BLTUC met in Birmingham on the same day. Some 300 senior Shop Stewards, who claimed to represent 160,000 car and commercial vehicle workers, were in attendance, and they unanimously resolved to fight any compulsory redundancies or plant closures. They laid down conditions for their continued support for Michael Edwardes’s plans.

The meeting recommended action throughout British Leyland factories to black exports for South Africa during the TUC’s anti-apartheid Week of Action from 13 to 21 March. The BLTUC’s Chairman, Derek Robinson, said: ‘Nothing will leave Leyland factories for South Africa that week, be it cars, Land Rovers or trucks.’ The irony was, of course, that British Leyland’s Chairman was from South Africa.

Working on the industrial relations

There was further progress in improving industrial relations. More than 100,000 workers in British Leyland car plants were covered by a new shopfloor deal which gave them much improved layoff pay when work stopped because of reasons outside their control, but imposed a stiff ‘penalty clause’ on those who took part in unconstitutional strikes.

The deal had emerged from Leyland Cars’ new central negotiating body, and represented the last major achievement of Geoffrey Whalen, the Director of Industrial Relations at Leyland Cars before his resignation. Signed by all car unions, the agreement was an attempt to maintain the earnings of workers at an average level when they were made idle by disputes either outside the company or in other British Leyland supplying companies.

However, at the same time, it sought to deter unofficial strikes by disqualifying those who took part in them from the layoff guarantees for three months. Under the deal, men laid off because of strikes outside the company would get a guaranteed 15 days’ pay in each quarter on full basic rate. When the layoffs resulted from disputes in other British Leyland sectors the guarantee was seven days in each quarter at 80 per cent of normal basic rate.

‘One of the most advanced in the industry’ – unnamed British Leyland spokesperson

Previous layoff agreements, which had been negotiated on a plant-by-plant basis, gave seven days’ pay for external disputes and five days’ for internal disputes, both at 80 per cent of basic rate. The tough penalty clause would mean that any workers taking part in what the company described as ‘unconstitutional disputes’, as opposed to unofficial stoppages, which could sometimes be ‘constitutional’, would forfeit all entitlement to layoff pay during the following quarter.

The agreement was backdated to November 1977, and from 1 March 1978 there would be other clauses that would give fresh guarantees on pay for workers absent because of bereavement, hospital attendance, civic duties and certain other reasons.

A Leyland Cars spokesman described the deal as ‘one of the most advanced in the industry’.

Derek Robinson’s view

In The Times newspaper of 9 February 1978, Derek Robinson discussed the new strategy at British Leyland. He was Chairman of the BLTUC and the senior Trade Union spokesman on the Leyland Cars Joint Management Council – the top tier of the company’s worker participation machinery .

‘There is a certain irony about the acclaim accorded over the past week to Mr Michael Edwardes, the new Chairman of British Leyland. It suggests a perverse delight that someone has at last taken the axe, for good or for ill, to what is one of the nation’s leading companies and most successful exporters.

‘After three months of deliberation, the two main decisions from Mr Edwardes are:

  1. To reverse the trend of the past decade and try to break down Leyland into its constituent parts – an action totally counter to the policies of integration pursued by major car makers throughout the world.
  2. Publicly to announce that ‘People are now walking past our showrooms’ and that we can expect to sell no more than 819,000 vehicles this year.

‘On the first point, Mr Edwardes does not need the Trade Unions to tell him, he has received enough warnings from his own management – how foolhardy it would be to attempt to overturn progress made over the past two years towards achieving economies of scale. Work is already well advanced to reduce the number of different body shells and to develop common power and transmission units and components.

‘Moreover, the impact upon morale at plant level of a complete U-turn from the philosophy advocated in the Ryder plan less than three years ago will be damaging. With each shuffle of Leyland’s already depleted management more talent is lost; Shop Stewards are already beginning to lose track of the changing faces on the management side of the negotiating table.

‘The defeatist attitude which Mr Edwardes has so far adopted towards Leyland’s sales performance is a matter of concern for the Trade Unions, and we are determined to maintain our campaign to go for an output of at least 1 million vehicles. The Chairman made some move towards our position by including in the resolution adopted by management and union representatives at Kenilworth a pledge to make further efforts to increase market share.

All parties want to give ‘unanimous support’

‘The virtually unanimous support the Shop Stewards were able to give to Mr Edwardes’ seven-point resolution underlines the common aim of management and Trade Unions to secure a profitable future for the company. He would be foolish to treat lightly the goodwill that he now enjoys.

‘We are pledged to make every effort to improve quality, reduce the number of disputes and ensure continuity of production. Indeed, at factory meetings the Cars Council, the top tier worker participation body, has gained overwhelming support for such a strategy. The Trade Unions understand as clearly as Mr Edwardes that productivity must be raised to the level of our international competitors in order to make Leyland viable.

‘However, management must not consider that it has a blank cheque to push through changes unilaterally. Mr Edwardes has given his word that adjustments in manning or production capacity will be “the subject of proper negotiating procedures”.’

The closure of Speke was big news in 1976.
The closure of Speke had been big news in 1976

Speke: down to management

Robinson added: ‘He will be under an obligation to ensure that the commitment is honoured for there is a deep suspicion within Leyland that management is not above contriving disputes when production, for whatever reason, is not needed. Certainly, the 14-week stoppage at Speke, Liverpool, was caused by management ignoring procedure.

‘On the subject of plant closures Mr Edwardes has made it clear that he would consider such contingencies only if Leyland’s market position continued to deteriorate. One problem which he has already acknowledged is the damage caused by the obsession of the media with Leyland’s labour disputes. The prejudice of newspaper proprietors against state-owned concerns, coupled with the reporting requirement to simplify and sensationalise issues, makes Leyland an obvious scapegoat.

‘Anyone familiar with the monotonous, often inhuman routine of the car plant would appreciate that even the so-called ‘silly strikes’ often arise out of a history of suppressed grievances and frustrations. The pundits who are always prepared to lambast the Leyland workers seem totally to ignore the fact that the latest crisis was caused by circumstances completely outside the company.’

Lucas strikes hurt British Leyland in 1977

He added: ‘It was the ten-week strike by Lucas toolworkers that began to take its toll of Leyland car output in August. Market share was hit, dealer and customer confidence shaken, and the debate about the company reopened. This was a tragedy for Leyland workers who had fought so hard to recover the company’s position after the unofficial and damaging strike by some toolmakers in March.

‘In the four months from April to July output really began to move, profitability was restored, and productivity rose dramatically. A review of car operations to assess the impact of the toolmakers’ strike was approved by the British Leyland Board in the summer; it recommended that the Ryder objectives of a 32 per cent market share and an annual output of 1.2 million vehicles were still attainable.

‘But merely to concentrate attention on the past 12 months is to ignore the problems inherent within the monolith that is Leyland. Its very creation was the result of a series of defensive mergers and acquisitions under the pressure of market forces.’

The folly of brand mismanagement

Robinson continued: ‘Throwing together such a range of once proud and often individualistic companies confronted management with an awesome task. Mr Edwardes is certainly not the first, and probably not the last, to wrestle with the organisational issues. He maintains that there was neither the strength of management nor the time available to make workable the organisation devised by Ryder.

‘It is only to be hoped that the Government allows Mr Edwardes the time to make his alternative work. But the issue on which the Trade Unions are best qualified to comment is industrial relations. Here, Labour ministers, who have adopted a self-righteous attitude to the problems of the company, should accept their share of responsibility.

‘It was sheer hypocrisy to first bind Leyland management hand and foot within the confines of incomes policy and then tell them to sort out the company’s chaotic wage and bargaining structure. The toolmakers’ strike erupted last year, but its origins go back further.’

Wage unrest rising in the industry

He said: ‘Six years of almost continuous wage restraint have created anomalies and eroded differentials to the point where there is unrest throughout British industry. The fact that trouble broke out at Leyland should have come as no surprise. Which other major company was asked to carry such a burden of pay anachronisms in addition to the pressures caused by wage restraint?

‘Leyland was precluded from sorting out the mess by the rigour of official Government policy. Even under the so-called return to free collective bargaining of Phase Three, it has not been possible to implement a common pay starting date for all 34 plants. Clearly, the reasons for the collapse of Ryder are far wider than the issue of labour relations.

‘However, we for our part have taken an unprecedented initiative to try to improve output and quality. But continuity of production and high efficiency will be more readily achieved under an aggressive policy of expansion. We draw support for the viability of our alternative strategy, from the fact that other managers within Leyland apparently do not share Mr Edwardes’ pessimistic view.

British Leyland Motor Corporation (1968-1975)

‘The Chairman has been emphatic that, even without any further industrial troubles this year, sales can be no more than 819,000, an average 27 per cent market share. But Leyland Cars’ 1978 budget, presented to the Cars Council only last month, stated that, on a conservative assessment, a 29 per cent share could be achieved by the end of the year. Potential existed for sales in excess of that and the trade had set targets of around a 32 per cent market share.

‘In the words of the management presentation: “It would be very easy to be too pessimistic and structure the operation by reducing production programmes, thus making doom a self-fulfilling prophecy. We are certain that we must leave the way open to demonstrate, for all to see, that we must, can and will achieve a much higher United Kingdom market share than any of our uninformed critics believe possible”.’

‘That, basically, is also the view of the Shop Stewards.’

It was clear that the euphoria from the Leamington Spa meeting was now wearing off.

Trouble in Scotland

Meanwhile, the former BMC commercial vehicle plant at Bathgate, West Lothian was enduring a simmering dispute by 44 Electricians which had virtually halted all production.

The Electricians had imposed a ban on maintenance of electronically controlled machines in the plant. Under a £7 million investment programme, many of the new machines being installed were electronically controlled and so were out of action.

The Electrician’s dispute meant that the company’s weekly production of £4 million worth of trucks and tractors was being lost. A proposed productivity scheme which had been rejected by the shopfloor labour force was also unacceptable to 900 clerical and supervisory staff at the plant. And the dispute at the Speke No.2 factory still rumbled on. It had now been declared as official by the TGWU as a mechanism for the union’s leadership to become involved in order to achieve a resolution.

Ferreting out ‘the Mole’

On 13 February an internal Transport and General Workers Union inquiry, by its Oxford District Committee, had recommended for expulsion from the TGWU Alan Thornett, the British Leyland Cowley Shop Steward known as ‘the Mole’.

The TGWU Oxford District Committee had inquired into 11 TGWU members at the Cowley plant. Frank Corti, another branch officer, was recommended for exclusion from union office.

The following day another British Leyland executive resigned and was to leave the company at the end of the month. He was Michael Pybus, head of the profitable Land Rover-Range Rover division. Mr Pybus, a 38-year-old former Ford and Chrysler finance expert, joined British Leyland in 1970. He joined Chrysler’s Paris office as controller of Chrysler Europe.

The first closure: Speke

On 15 February 1978 Michael Edwardes and his team bit the bullet and announced plans to close its No.2 Triumph TR7 assembly plant at Speke, Liverpool, and make some 3000 workers redundant.

An official company statement said: ‘The company has come regrettably to the conclusion that there is no alternative to the proposal that the Number Two plant in Speke Hall Road must close in the interests of the company as a whole. It is intended that TR7 assembly should be transferred to the Midlands and that the Number One plant will continue to produce body pressings for the TR7 and bodies for the Dolomite range of cars. The proposal is made on the necessary commercial basis that BL Cars must become efficient and profitable if it is to survive.’

The statement said the National Enterprise Board and the Government had pledged their support to British Leyland, but to justify that support it was essential that the company should improve its efficiency, reduce fixed costs and concentrate cash resources on the vital area of its business.

Not going down without a fight

It was also made clear that, even if there was a settlement of the 15-week strike, the closure would go ahead, while the Labour Government indicated that it would not step in to save the plant.

However, one union leader gave a warning that no action would be ruled out in the fight to save the factory on Merseyside where unemployment was already running at 10.6 per cent, well above the national average.

Derek Robinson said that some form of industrial action was a ‘distinct possibility’ and he said it would, ‘affect the whole of the Trade Union movement in Leyland. Our national people will have to come to certain decisions.’

Criticism from Canley

Eddie McGarry, the Convener at the Triumph Canley plant, said any plan to move equipment or assembly would be resisted until the dispute was settled or there was some agreement.

He said of Michael Edwardes: ‘He should have been big enough and bold enough to state what he was going to do when he met us two weeks ago. We are totally opposed to redundancy unless it is carried out on mutually agreed terms.’

The Parliamentary Labour Party met to hear from the Prime Minister James Callaghan. He denied that the decision to close Speke No.2 had come to the Cabinet for approval. But he conceded that Eric Varley, the Secretary of State for Industry, and Albert Booth, the Secretary of State for Employment, were informed by the British Leyland management ‘and they did not dissent.’

Edwardes ‘deserves our backing’

While deploring the loss of jobs, James Callaghan emphasised that a man had now been put in charge of British Leyland, ‘who deserves our backing’. If British Leyland did not become viable, then many more jobs would become vulnerable.

It would be very difficult for the Government, having just appointed a new general manager, to come in straight away and tell him what he was to do. ‘It would not be wise, at the outset of a new era in the history of British Leyland, for the Government to step in and pull at Mr Edwardes’s coat tails,’ he said.

During the weekend there was a full meeting of the BLTUC. The Shop Stewards issued an unequivocal challenge to Michael Edwardes, British Leyland’s Chairman. They stated that unless the proposal to switch Triumph TR7 car assembly from Speke, Liverpool, to Coventry was abandoned they would mobilise the entire British Leyland labour force behind their resistance campaign which would include a ‘blacking’ of the work from Merseyside by all other plants, and possibly a sit-in at the Liverpool plant.

Triumph TR7

Triumph TR7 moves to Coventry

British Leyland’s offer of what appeared to be among the most attractive severance terms ever offered in the motor industry apparently made no impression on the Shop Stewards. They saw the decision to end the assembly operations at Speke as probably only the first move in the new tough policy of Michael Edwardes, who had already revealed plans to cut the total Leyland Cars’ labour force by 12,500 in the immediate future.

Meanwhile, the continuing failure by Michael Edwardes to recruit a ‘Cars Supremo’ had forced him to take on an additional role as Chairman of BL Cars, the new umbrella company for the three reorganised car subsidiaries.

On 20 February, Michael Edwardes confirmed the board of BL Cars, naming himself as Chairman ‘for the time being’. There were no surprises. With the exception of the three recently recruited Directors – Ray Horrocks, Managing Director of Austin Morris Limited, William Pratt Thompson, Managing Director of Jaguar Rover Triumph Limited and John Hirsch, Director of Product and Marketing Strategy for BL Cars Limited – the remainder were long-serving British Leyland employees.

They were Colin Daniel, Director of Finance and Systems; Spen King, Director of Engineering; Brigadier Charles Maple, Director of Quality; Bill McLean, Director of Employee relations; Pat Lowry, Corporate Director of Personnel and Administration; and Gerry Wright, Corporate Director of Finance. The last two were non-executive members of the Board. A vacancy on the Board still remained for the Managing Director of the third BL Cars subsidiary company, BL Components Limited.

Sales up, management down

The sales figures for January 1978 were also in. Britons went on a surprise car buying spree in January 1978, traditionally a slow month. Sales were up 33.5 per cent on January 1977, and new British cars sales increased 18 per cent. However, import sales jumped 53 per cent to capture 50 per cent of the British home market. Ford sales went up 55 per cent to give it almost a 30 per cent market slice. British Leyland’s sales only held even and its market share slid from 28.6 to 21.4 per cent.

On 1 March, another senior car executive left British Leyland. This was Ian Showan, the Director of Manufacturing for Leyland Cars. Ian Showan would leave at the end of the month because the central staff post he had held since 1976 would disappear under the Edwardes’ reorganisation.

He was one of British Leyland’s most experienced production executives, holding a number of senior manufacturing posts since joining Morris Motors in 1956. From 1970 to 1973 he was in charge of the Cowley assembly plant. Before his present post he was Managing Director of the Body and Assembly Division of Leyland Cars.

An unnamed colleague said: ‘We can ill afford to lose men like Ian. Men of his experience and standing are like gold in the car industry. I should not be surprised if one of the component firms snaps him up like Derek Whittaker.’ Derek Whittaker, the former Managing Director of Leyland Cars, had recently joined GKN, one of the motor industry’s biggest suppliers, at its Birmingham head office as General Manager of Product Development.

End to the three-monthly reappraisals called for

On 19 March, Michael Edwardes spoke to a Coventry Chamber of Commerce lunch. In his speech, he revealed that a new corporate plan covering the next five years and providing for further large injections of public money had been submitted by British Leyland to the National Enterprise Board.

Michael Edwardes said that previous ‘stop-go financing policies’ had led to uncertainties both inside and outside the company, and he called for an end to the three-monthly reappraisals of the investment programme.

‘The conditional release of funds against good behaviour has clearly not worked in anyone’s interest. I am sure that all parties in Parliament will appreciate that British Leyland must be run like any competitive enterprise and without strings attached’.

‘The company has not known where the next pound was coming from. Potential customers hurried past our showrooms, thinking we were going out of business. It was little wonder that our suppliers felt less than confident about our future,’ he said.

Edwardes: BL needs profitability as soon as possible

He stressed that British Leyland’s future cash requirements would have to come increasingly from profits. ‘I may be sticking my neck out, but I now believe that British Leyland is on the way back,’ he said.

‘There is much to do and a long way to go, and we are still very vulnerable, but we are back in business… There is now, I believe, a tremendous amount of goodwill and support for British Leyland. The vast majority of people in this country are willing us to succeed despite our appalling public image.’

Since 1 November 1977, he said, the number of British Leyland vehicles lost through disputes had dropped dramatically, while quality levels had risen substantially. Since January 1978, BL Cars had produced 24,000 more units than a year earlier, a rise of 18 per cent, while manpower had risen by only 1 per cent.

Job losses: coming into view

At a press conference later, Michael Edwardes discussed British Leyland’s finances. ‘The attitude of the Board is unequivocal, to have this business turn the corner and grow, we have got to have a strong balance sheet.’

Michael Edwardes declined to give a breakdown of the company’s financing plans now with the NEB, but said that the emphasis was more on equity than borrowings. The final figure was ‘very much up to the Government’.

Ray Horrocks, the new Managing Director of Austin Morris Limited, had wasted little time in meeting the demanding requirements of Michael Edwardes, the Chairman of British Leyland. The first casualties were rumoured to be 1200 jobs at Longbridge, the biggest plant in the state-controlled group

Trade Union sources said on the same day as the Chairman’s speech in Coventry that the management had indicated that this number of jobs was surplus to production targets and would be phased out. The ‘weeding out’ process had already started.

Hundreds of men had been withdrawn from their normal work and put into the labour pool, which was a permanent feature of motor manufacturing. Stand-by labour had to be maintained to fill gaps in assembly lines caused by absenteeism and illness. According to workers leaving the factory, the swollen labour-pool men were sitting around ‘twiddling their thumbs’.

Under attack from Michael Grylls

On 17 March, The Times newspaper published an article ‘Setting a timetable for profitability at British Leyland’ by Michael Grylls, the Member of Parliament for Surrey, North West, and Vice-Chairman of the Conservative Industry Committee. Mr Grylls (1934-2001) was an MP from 1970 to 1997. He was the father of the broadcaster Bear Grylls.

Michael Grylls, who was an arch critic of British Leyland, made some valid points in the article.

‘Conservatives in 1975 made it quite clear that we were highly sceptical of the Government’s ‘benchmark’ approach. Investment in large-scale industry cannot be turned on and off like a tap-turned off when people strike and on again when they go back to work. Yet Leyland was not a normal industry. It was an ailing giant which could not have attracted investment funds from the City.

Grylls: only taxpayer money could save BL

‘Only taxpayers’ money could rescue it,’ he said. ‘Naturally, MPs felt a duty to watch over taxpayers’ funds. If the Government in 1975 did genuinely start out by hoping it could follow the benchmark approach it was soon blown off course by events. Unfortunately, the Chairman of the National Enterprise Board and the author of the Leyland rescue plan were one and the same person, Lord Ryder.

‘During 1975 and 1976 Leyland met neither of Sir Harold Wilson’s original conditions. Productivity was stagnant and strikes just as frequent. Lord Ryder, as Chairman of the NEB, could hardly be expected to be tough on his own creation. So, in May, 1976, while admitting that performance had been disappointing in certain respects, the NEB still advised Mr Varley to approve the first £100m loan.

‘In fact, in the 1976 audit period, the annual production was 784,800 vehicles, the lowest in the ten-year history of Leyland. Productivity in vehicles per man year was 4.28, as opposed to 4.41 in 1975. Hardly an encouraging picture, not much evidence there of monitoring or meeting benchmarks.’

The financial results: BL at a loss

The following day Michael Edwardes was in Leyland to inaugurate an £8million diesel engine test facility, part of an investment programme of £135 million. But he ended up discussing British Leyland’s preliminary financial results for the previous year, which showed a loss of £51.9 million, including £31.9 million lost by BL Cars, which effectively cancelled a profit of £26.6 million by Truck and Bus and £8.4 million by Special Products. BL would have broken even but for a special provision of £43.9 million to cover the cost of closing the TR7 plant at Speke, Liverpool, and further cuts planned in South Africa and Scandinavia.

It was disclosed at a press conference in Leyland that a new strategy plan being considered by the Government contained a major switch in investment from the loss-making Cars operation to the group’s profitable Truck and Bus and Special Products subsidiaries.

The changes had not been discussed with Shop Steward representatives on BL Cars’ Council – the top tier of the employee-management participation machinery.

Edwardes: ‘We have a hell of a problem’

Michael Edwardes declined to comment on newspaper reports that he had asked the Government for £400 million to be injected as equity funding. Asked what would happen if the Government did not meet his funding requirements he said: ‘We shall have a hell of a problem. But it is inconceivable to me that the funds will not be forthcoming from our shareholders.’

He said BL capital spending in 1977 had totalled £96 million but ‘very considerably more’ would be required in 1978. What was not acceptable was a return to the previous ‘on-off’ situation when the allocation of investment funds tried to keep step with industrial relations. This gave undue prominence to disputes which might otherwise have been resolved earlier. It was a situation which did not apply to BL’s competitors.

If BL management still did not perform it would have to pay the ultimate price. Michael Edwardes said that with a pre-tax profit of £3.1 million the company was breaking about even on trading. In view of the very difficult circumstances encountered in 1977 with labour and other problems, the previous management deserved to be complimented.

It’s not all bad news, though

He said it would be grossly unfair to condemn any company to summary execution on the basis of one year’s results. The heavy losses sustained by Cars showed the urgent need for a major restructuring respite the recovery of recent months. Car production so far in 1978 was 18 per cent up on the same period of 1977 but there was still a need for caution – ‘one swallow does not make a summer’, he said.

However, there were good things to report. Since 1 November 1977 Rover SD1 production had doubled and management were now planning a further 35 per cent increase in the next few months. The availability of Rover SD1 cars would test the patriotism of all those company executives who claimed that they had had to buy foreign because they could not get delivery of a Rover. He expected another difficult year in 1978 with no big increase in profits because management were still wrestling with fundamental problems.

At £24 million, Speke accounted for more than half the special provisions for closures and cutbacks. Company sources said this included an amount to cover TR7 jigs and fittings which BL still hoped to transfer from Speke to Coventry, the planned new home of the Triumph TR7.

Parts and Service loses its head

Another senior British Leyland executive resigned. Jerry Clancy head of the car BL Components (née the Parts and Service Division) and a former Director of Leyland Cars, was leaving at the end of the month. The Parts and Service Division had a turnover of £500 million a year and had been expanded by the inclusion of the former Pressed Steel Fisher car body factories.

A replacement would be announced within the next few days. However, sources close to Jerry Clancy said that the fact that he had not been chosen for the new job was not the reason for his departure.

A colleague said: ‘Jerry was in fact offered a much more senior corporate appointment but felt that with BL at the crossroads now was a good time to make a move outside the company.’

Jerry Clancy had joined BLMC in 1972 after 14 years with Ford of Europe. He was Director of Finance, Planning and Control at Leyland Truck and Bus until 1976, when he moved to cars to take over parts and service. In 1977 his responsibilities were increased by the inclusion of Vanden Plas, foundries and a reorganised SU-Butec.

On 22 March it was announced that the Managing Director of the newly-formed BL Components would be Peter McGrath, who would take up his position after Easter 1978. Peter McGrath had joined British Leyland in May 1977. He previously held financial and managerial posts with Ford, British Railways and the National Freight Corporation.

Edwardes gains more funds for BL

On the same day it was revealed that British Leyland was to receive a short-term loan of £275 million from the National Enterprise Board to tide the group over the coming months. This would give the Government, the NEB and the company more time to settle new financing arrangements covering a corporate plan.

Eric Varley, the Secretary of State for Industry, explained that the £275 million, which he had authorised the NEB to make, would enable the company to repay some temporary borrowings and to continue its capital expenditure programme ‘until Parliament has been able to consider the situation’.

British Leyland’s corporate plan was now in the Government’s hands and this included proposals for strengthening the company’s balance sheet by a ‘substantial’ injection of equity capital. Eric Varley had also received a report from the NEB which fully supported British Leyland’s forward programme, revised under Michael Edwardes, the Chairman.

Eric Varley gave a Commons written reply on the same day in which he stated: ‘The Government generally endorses the NEB’s recommendations but some of the financial arrangements are still under consideration. I shall be bringing the Government’s proposals to Parliament as earlv as possible in April. The House will have the opportunity to debate these.’

Reorganisation continues at speed

Then, on 24 March, 20 new senior appointments, including four Managing Directors, were announced by British Leyland in the newly-formed Austin Morris Limited and Jaguar Rover Triumph Limited companies. Bob Knight became Managing Director of Jaguar Cars Limited, Mike Hodgkinson, Managing Director of Land Rover Limited, Jeff Herbert, Managing Director of Rover Triumph Cars Limited, and Brendan Reville, Managing Director of BL Ireland Limited.

Jeff Herbert had joined British Leyland from Perkins, the diesel engine manufacturers, in 1977 as Director of Production and Plant Engineering for Leyland Cars.

A company statement said the executives nominated for the 20 posts would continue to carry out their existing responsibilities while helping in the development of the new organisation.

The other appointments were:

Austin Morris Limited

  • Ron Harvey – Quality Director
  • Gordon Macfarquhar – Director, Salaried Personnel
  • Tony Gilroy – Operations Director, Longbridge
  • John Symonds – Operations Director, Oxford and Seneffe
  • Cliff Toll – Operations Manager, KD
  • Lester Burford – Director, Purchasing
  • Joe Clay – Director, Production and Plant Engineering
  • George Payne – Director, Industrial Engineering
  • Bob Holland – Director, Production Control
  • Trevor Taylor – Director, United Kingdom Sales and Marketing Operations
  • Bert Lawrence – Director, European and Overseas Sales and Marketing Operations

Jaguar Rover Triumph Limited

  • Graham Whitehead – President BL Motors, USA/BL Canada
  • Michael Fernyhough – Director, Purchasing
  • Bill Davis – Director, Government and Military Affairs
  • Michael Edwards – Director, Salaried Personnel
  • Cedric Scroggs – Director, Marketing.

Bill Davis, the one-time BMC Deputy Managing Director with responsibility for production, was still clinging on.

The new Corporate Plan is signed off

On 3 April, British Leyland received the full backing of the Government and the National Enterprise Board for its new four-year Corporate Plan which would involve an injection of public funds totalling £850 million, a capital investment programme of about £1.3 billion, and the loss in 1978 of 10,000 jobs.

The Government had endorsed the company’s proposal that the NEB provided £450 million in 1978 in the form of new equity of which £300 million would come from NEB funds and £150 million from the Government under Section 8 of the Industry Act 1972. British Leyland’s plan, published in abridged form by the NEB on this day, forecast that the company would be able to match the £850 million of public money with internally generated funds.

The timing of the plan had been changed, the company’s own contribution was less ambitious, there was greater emphasis on equity rather than loans, and the projected domestic market share for BL Cars had been reduced.

The NEB had agreed with Michael Edwardes that the linking of long-term investment finance to day-to-day industrial relations performance was ‘unhelpful and damaging to the business’.

Government increases stake in BL

Giving details of the plan in the Commons, Eric Varley, the Secretary of State for Industry, said that if there was a serious risk that the objectives could not be achieved ‘then the Government with the company and the NEB will have to consider the options and the Government would have to accept the financial consequences of any change of plan that it might then agree with the NEB’.

The £450 million in equity finance in 1978 would give the NEB a 99 per cent stake in British Leyland with a reduction in the proportion owned by private shareholders. The Government has accepted that the NEB’s financial duty for British Leyland should be a ten per cent return on capital by 1981.

The March 1978 loan helped pay off the private borrowings and provided the company with breathing space before the new Corporate Plan was agreed. In 1977 British Leyland committed itself to £281 million of capital expenditure but spent only £134 million including £96 million in the Cars group.

The report outlined a loss of 10,000 jobs in 1978, excluding those at the Speke plant in Liverpool, which it was hoped would boost productivity per man to 6.4 cars in 1978.

Austin Maxi production at Pressed Steel Fisher, Cowley in 1978

Pressed Steel Fisher loses its head

On 10 April it was reported that David Simpson, the Managing Director-designate of Pressed Steel Fisher had resigned. David Simpson was the eleventh executive to leave since the arrival of Michael Edwardes five months earlier but he was the first to do so after accepting a post in the reorganised BL Cars subsidiary.

He had been named to head the new body company less than two months before. A statement issued by BL Cars said David Simpson wished to emphasise that he did not disagree with the company’s new objectives, and left with mutual goodwill on both sides. He was considering a number of offers and had not yet made a firm decision.

GKN had already recruited Derek Whittaker, Jerry Clancy and Desmond North, Director of the Cowley assembly plant. Desmond North had been recruited by BLMC in 1969. A former Chrysler and Ford Cost Controller, he had created a department to oversee the costing of the next generation of models, the same models that were now stalling in the sales charts.

A senior GKN executive said: ‘We are not just finding jobs for these people. We are delighted to be capturing such wonderful material. It is a chance in a lifetime and we should be foolish to pass it up. These men have priceless motor industry experience and anyone who thinks that we are taking them on simply because they come from our biggest single customer is making a serious mistake.’

Still at more than 30 per cent market share

During March 1978, BL Cars captured 31 per cent of the UK market. A record 55,000 cars came rolling off the production lines. But an unnamed British Leyland executive warned: ‘The vital thing is to keep up this level of production. It does prove, though, that the British public will rush to buy Leyland cars.’

Industry Secretary Eric Varley said in the House of Commons that British Leyland should have no cash problems after the next few years. Eric Varley was proposing that the car giant should get an extra £170 million of Government money.

He said that, without this state aid, the whole West Midlands could become an industrial desert. The extra cash was approved without a vote.

Speke closure confirmed

On 12 April, Pat Lowry, British Leyland’s Director of Personnel and Administration, said that the Triumph TR7 assembly plant at Speke would close on 26 May. Also that day British Leyland announced that it had appointed John Symonds as Managing Director-designate of Pressed Steel Fisher.

John Symonds replaced David Simpson, who resigned only two months after accepting the post. Until his new appointment John Symonds, who joined BLMC in 1971, was Production Director with responsibility for Austin Allegro and Mini production at Longbridge and Seneffe (Belgium), MG sports cars at Abingdon and Maxi, Marina and Princess at Cowley.

Edwardes: we need more Engineers

Michael Edwardes had given an interview to The Engineer magazine. He disclosed that ‘hundreds’ of top Engineers left the motor group in 1977, causing a shortage of key personnel at the worst possible time.

He was trying to persuade some of them to return to work on new car development, and the facelift for the Marina (above), due out later in 1978. The new-look Morris Marina was urgently needed to boost British Leyland’s ageing range of cars, but reliable sources reported that it was between six and nine months behind schedule and unlikely to appear before spring of 1979.

In the interview Michael Edwardes said; ‘We employ 500 very senior managers, but our loss is only two per cent, which is tiny. If we lose any good men, then I am sorry, but the scale is not a factor. Indeed, for every good man that leaves we have three to take his place. I can think of only three men whom I regret leaving the company. The departure of other managers is just not significant. When you reorganise a company you expect to put peoples’ noses out of joint.’

Trying to woo the ex-pats

Michael Edwardes had for some time been trying to persuade British managers to return from the United States and Canada to take up key posts in his new team. But he had had little success.

‘To bring British managers back is a real blighter. But it is not a credibility problem. Just one of taxation. There must be some hundreds of British managers who, if they could be attracted and brought back, could help to transform the industrial scene in this country. We have lost the very innovative and skilled technologically-orientated managers we damn well need. The chaps we do need, we have lost,’ he said.

Michael Edwardes had found one company in North America which had recruited 43 Britons, all of whom left for tax reasons. He disclosed that with the permission of their new employer he had sought and obtained their names and reasons for leaving.

The brain drain continues

Then, on 17 April, much to the media’s delight, another executive quit, and it was one of the bigger fish, Gerry Wright, the new Corporate Director of Finance. Gerry Wright had worked for English Electric, Ford and AEI before joining BLMC as Finance Director for the Truck and Bus Division in 1968. From 1972-74 he was Deputy Managing Director of Leyland South Africa and in 1974-75 was appointed Controller of Corporate Finance.

In 1975, he became Director of Finance, Planning and Control and, on the arrival of Michael Edwardes, was appointed Director of Finance. Gerry Wright was not a member of British Leyland’s main Board, but sat on the Advisory Board with the heads of the operating companies.

Back in February 1968 in his capacity as Leyland Motors new Chief Accountant, he had travelled to Longbridge with his opposite number from Standard-Triumph, Walter Boardman, and his boss and the man who had recruited him, John Barber, to examine the British Motor Holdings books in order to assess the viability of the proposed Leyland-BMH merger.

Gerry Wright’s resignation was described as being for ‘personal reasons.’ It was understood that there had been no policy disagreements and that Gerry Wright did not have another job lined up.

BL also announced that Pat Lowry, Director of Personnel and Administration, was to become Non-Executive Chairman of SP Industries, formerly the Special Products division, and David Andrews was appointed the Non-Executive Chairman of British Leyland International.

Toolmakers decide to strike

On 22 April, the 60 members of the British Leyland Tool Room Committee met for 140 minutes in a room over the Good Companions public house at Yardley, Birmingham. After calling all 4000 tool room men out on a one-day strike in June, the 60-man committee went on to set up mass meetings which would be urged to take other, tougher industrial action in support of their claims.

The toolroom men, British Leyland’s most skilled engineering workers, were bitterly disappointed that no progress had been made on their wishes for separate representation, or for the restoration of the higher pay levels they once enjoyed over semi-skilled and unskilled workers.

Roy Fraser, the Chairman of the Tool Room Committee, said: ‘Our members are very frustrated, at the lack of progress. They are demanding that something should be done. We are determined to fight on until our objectives are reached.’

Land Rover takes shape

Three days later Michael Edwardes announced the board of the newly-formed Land Rover company. It was headed by Mike Hodgkinson, who at 34-years-old was one of the youngest executives in the group.

It was revealed that British Leyland paid out £110,000 in golden handshakes to former Directors in 1977.

Austin Maestro design chosen

It was during April 1978 that Leyland Cars/Austin Morris Product Planning held styling clinics to evaluate the merits of the competing Longbridge and Solihull Austin LC10 and LC11/LM11 designs. These were the intended replacements for the Austin Allegro and Morris Marina

The Solihull design (above) was designed by Ian Beech for David Bache, the Leyland Cars Styling Director at the Rover Solihull studio. Of the Longbridge designs, one was by Harris Mann (below), Designer of the Princess (ADO71), Austin Allegro and Triumph TR7

Roger Tucker of Longbridge also designed a hatchback and a notchback, the latter for the bigger LC11 version.

Harris Mann LC10

Montego still in flux

David Bache rejected the Harris Mann design outright and decided to put forward in both hatchback and notchback forms: the Ian Beech Solihull design and the Roger Tucker Longbridge contender. The Product Planners decided on Ian Beech’s hatchback for the LC10 car.

For the LC11 notchback the Product Planners were indecisive. They liked the front and rear of the Roger Tucker design, but preferred the bigger passenger cabin of the Ian Beech proposal. The upshot was that it was decided to graft the front and rear of the Roger Tucker design onto the passenger cabin of the Ian Beech passenger cabin!

Harris Mann was given the task of overseeing this task at the Longbridge Styling Studio to create the corporate LC11, while Solihull worked on the LC10 design. In time, these would be rebranded LM10 and LM11 and emerge as the Austin Maestro and Montego.

Austin LM11 Montego proposal

Solihull ahead of Longbridge

Hindsight would reveal that BL and David Bache got the styling of these cars spectacularly wrong and that the Harris Mann design was the kind of state-of-the-art design that would have more suited the 1980s.

However, in terms of contemporary credibility, all the Harris Mann-styled cars that had made it to production were in all sorts of trouble, while the Rover SD1 designed by David Bache was basking in the European Car of the Year Award, so it is easy to see why senior management listened to the judgement of their Head of Styling, much to Longbridge’s chagrin.

It also helped that the management were in apparent denial of the build quality issues of the SD1, which were as bad as anything penned by Harris Mann.

Speke in the news again

On 4 May Michael Edwardes gave a television interview. He discussed the Speke closure among other things. He responded to criticism by some employee representatives who had claimed that the company was being unambitious in going for output of just over 800,000 vehicles for the financial year. Some of them had spoken in terms of a million cars this year.

He added: ‘At the present rate of progress we will not make 800,000 cars to sell. This is a challenge. We either get the sort of figures we are programmed for or we may as well pack it up.’

Asked if further closures would follow if the company did not reach its production targets, Michael Edwardes replied: ‘No question of doubt. At the end of the day, if you do not produce to supply market demand, that market demand drops. It is a spiral and down you go.’

Leyland management position filled

That same day, Leyland Vehicles, formerly the Truck and Bus Division of British Leyland, appointed one of BL’s senior export executives, David Kimbell, to head its newly-formed Overseas Division.

He was responsible for sales, marketing, and service outside Europe as part of an operation taken over from Leyland International. He would be based in the Overseas Division’s London office.

Born in 1944, David Kimbell had joined Leyland in 1966 and had worked with Leyland International. His full name of David Henry Spurrier Kimbell implies that he may well be a relative of Sir Henry Spurrier, the former Chairman of Leyland Motors, who died in 1964.

Hugh Scanlon

Hugh Scanlon on BL’s future

On 8 May Hugh Scanlon (above), the President of the Amalgamated Union of Engineering Workers, spoke at their annual conference in Worthing on the subject of British Leyland. ‘Everyone knows there is a deep down malaise in British Leyland that we cannot afford to allow to go on, particularly when taxpayers’ money is going in,’ he said.

He was speaking against a motion calling for the rejection of any Government attempt to interfere with, close, or run down British Leyland. However, the motion was adopted by 35 votes to 33.

When the conference was asked to press the Government to spend more to modernise British Leyland plants, Hugh Scanlon said: ‘Why don’t you congratulate the Government for going ahead with its investment programme?’ Again his appeal was ignored and the motion was approved by 45 votes to 23.

This illustrated that, while the Trade Union barons may have understood the problems confronting British Leyland, many ordinary activists still felt it was central Government’s duty to keep the ailing monolith in being without surgery in order to maintain employment.

BL to become an importer


On 12 May it was revealed that British Leyland was preparing to follow its rivals – Chrysler, Ford and Vauxhall – and import more cars from the Continent to meet the demands of the best home market for five years. News of plans to bring in about 10,000 Minis from its assembly plant at Seneffe, Belgium (above), had already brought protests from some Shop Stewards at Longbridge, now the UK home of the Mini.

Management countered by saying that the alternative was to sit on the sidelines while the competition took full advantage of the boom. It emphasised that Ford, by importing one in three of all its United Kingdom sales from plants in Germany, Belgium and Spain took 30 per cent of the market in April 1978 compared with BL’s 17 per cent.

Shop Stewards’ concern stemmed from the fact that BL had only recently closed one of the three Mini assembly lines at Longbridge, a move intended to increase productivity and reduce costs. Production on the remaining two was not yet reaching targets, largely because some workers resented the recent closure and re-manning assignments.

Low productivity at Longbridge

Some sources claimed that Longbridge was producing only half its weekly quota of 3000 Minis. Shop Stewards had been assured that if Longbridge production improved quickly, Seneffe imports would be reduced.

But BL had to act quickly if it was not to miss the summer selling season and the introduction of ‘T-registered’ cars in August 1978.

A spokesman for BL Cars said: ‘We are optimistic that employees at Longbridge will accept that our objective is not to do them out of jobs but to take full advantage of the very high sales expected. Our American, European and Japanese rivals are building stocks almost daily by bringing in imports. We are only proposing to bring in cars, 75 per cent of which are manufactured in our United Kingdom factories.’

Losing sales, hand over fist…

Michael Edwardes had been recorded as saying: ‘Nothing is more damning than our steady decline in market share against a rising market. People are literally walking past our showrooms without a second look.

‘Is it any wonder our dealers are worried and some are defecting to our competitors and strengthening the hold of imported cars in this country. We have to stop the rot at home by improving output per man and regaining our competitive position.

‘The less we are able to produce quality cars steadily and thus regain market share, the more serious the de-manning will have to be. I believe the whole of the workforce is itching to see more decisiveness and more success.’

Speke finally closes its doors

It was on 26 May 1978 that the Speke No.2 car assembly plant finally closed. The full details of the closure are given in this site’s Rover Triumph story, but for British Leyland it was a landmark event.

Michael Edwardes had successfully called the bluff of the British Leyland (Motor Corporation Combined) Trade Union Committee (BLTUC), which had successfully opposed compulsory redundancies for a decade and gained the acquiescence of the Labour Government – a Labour Government which had, of course, originally stepped in to save British Leyland in order to maintain employment. It was only the beginning…

Back to History : The Edwardes Era – Part One : No future

Forward to History : The Edwardes Era – Part Three : Containment

Keith Adams
Latest posts by Keith Adams (see all)


  1. The O series engine that arrived for the T registration period was the big news of 1978, along with a light refresh of the Marina and improvements to the Princess, which received 1.7 and 2 litre versions of the O series. Compared with the elderly and thirsty B series engine used on both cars, the O series offered improved performance, refinement and economy. Also a 2 litre Princess would compete head on with the 2 litre Cortina and Granada, which were the Princess’s main rivals. The 1.7 engine used in the Marina gave the car improved refinement and economy, with 100 mph possible flat out, and acted as the entry engine for the Princess, offering better economy than the 1.8 B series.

  2. Aware one should not take things literally yet was under the impression ADO88 (before it became LC8) was longer than about nine-inches, which would place ADO88’s length at approximately Mini Estate, Hornet / Elf or Peugeot 104 Coupe levels at about 129-130-inches.

    A two-model approach for the Mini and what became the Metro was the right one, even though there were further opportunities for the former to benefit from improvements during the development in the latter that were not pursued on short-term cost grounds.
    Particularly with regards to making the Mini cheaper and less labour intensive to build (via one-piece floor pressing instead the existing 6 pressings), featuring hydragas or unless it was already the case, the relationship between the two cars being less carry over and more intertwined to the point of being on a shared platform a la Maestro & Montego or reminiscent of the stillborn Status Minnow (Innocenti had similar idea with SWB and LWB versions of the Mini).


  3. @ Nate, the Mini had to be replaced, even if sales were holding up quite well in the UK and France in the late seventies. It was a crude, dated car with a tiny interior, tiny boot, limited crash protection and poor refinement. The Metro was designed to meet the newer range of superminis head on by being a similar size to the Renault 5, offering a hatchback and having a large range of trim levels. Also using Mini drivertains probably saved British Leyland a large amount of money and meant familiar technology was available to the dealers. For the first two years of production, the Metro was a big success, taking 8% of the new car market, and being seen as the car that saved Leyland. As well, the Mini continued as a cult product with a small, but loyal following across Europe.

  4. @ Glenn Aylett

    Not disagreeing the Mini needed to be replaced, only noting there were further opportunities for the Metro’s improvements to filter down to the Mini in hindsight with the benefit of reducing costs amongst other things, if not for the Metro platform to even underpin a SWB Mini replacement to increase commonality between the two as well as both further bolster sales and reduce costs overall.

    It can be viewed as a reflection of the state the company was in where they were only able to afford singularly focusing on getting what became the Metro into production in the short-term, whilst at the same time not being in a position to engage in more long-term thinking by properly doing for the Mini and Metro what they were able to do for the Maestro and Montego.

    There was one ADO88 mock-up that with some styling enhancements to its retro-evolutionary cult car exterior had potential to play such a role below the Metro. It would be similar to the mk1 Micra derived Pao & Be-1, Fiesta-derived Ka or had it reached production the Nova-based Opel Junior concept.

    The possibility of the Metro being replaced by AR6 (length of Maestro-derived prototype stands at 139.7-inches via BMH’s Online Collections page) would also allow either a smaller AR6-based Mini replacement or for the ADO88-based Mini replacement with its modern retro-evolutionary exterior to easily be upsized to LC8/R6 dimensions. Which in turn would justify continuing the development of the 3-cylinder K-Series engine.

  5. The Metro’s problem was it rapidly fell behind when the new breed of superminis came on the market in 1983. It did steal a march on the Fiesta when a five door version was launched in 1984, but compared with the Peugeot 205, the Metro was way behind. The lack of a five speed transmission, which could have considerably improved the Metro’s refinement, became a criticism, and it was one of the few cars in its class not to offer a diesel model. It was a shame the AR6 wasn’t launched in 1987 with new engines, as this would have been a big improvement, but Rover was more concerned with developing the R8 but then.
    Interestingly the Mini seemed to lead a charmed life in the eighties. Luxury special editions, fancy colour schemes and an advertising campaign called Minis Have Feelings Too kept the car alive. Austin Rover research into Mini sales revealed it was a popular city car with young women who gave their cars names, and it continued to be seen as a fashion accessory by Parisians.

  6. The Metro was a car that had it been launched at the beginning of the 1970s around the introduction of the 1st generation superminis and particularly with R6 type Hydragas, would have had a very competitive run for over a decade before the 2nd generation superminis would have effectively made it something that with a rebody is at least better suited as a city car.

    There were ideas to develop a 5-speed manual and 5-speed automatic gearboxes for the in-sump Mini and Metro via Jack Knight, however they would have been an unnecessary expense the company could not afford at a time when the end-on gearbox was becoming a universal layout for transverse FWD cars.

    A few companies did sell models that featured both in-sump and end-on gearboxes like on the Peugeot 305, Citroen Visa and Nissan Cherry IIRC. With the Maestro and Montego initially using a Volkswagen Golf sourced end-on gearbox, it makes one ponder if the contemporary Polo used the same gearbox as the Golf or potentially a smaller more compact design better suited to the Mini (as a Maestro spec A+ with VW gearbox was found to be too tight to fit into the Mini during the Minki I project).

    Seem to vaguely recall reading online a few years back of a UK motoring publication circa the late-70s to early/mid-80s talking about BL’s involvement with VM Motori, where amongst other things it was speculated the Metro was to receive a 1.5-litre 3-cylinder diesel (basically a reduced version of the 1.8-litre 3-cylinder used in the Alfa Romeo 33). Though it seems to have disappeared from the web.

    Then there are those occasional yet so far unsubstantiated stories of the Daihatsu Charade 1.0-litre diesels being a possible candidate for use in the Metro, which were already used in the Innocenti Mini and one turbo-diesel Mini that Tony Spillane built himself prior to the Minki projects.

    It is not explained why the Metro never received a diesel until the PSA TUD in the R6, yet it is likely due to the in-sump 4-speed gearbox being a factor based on how the MG Metro Turbo and ERA Mini Turbo needed to be detuned as it could not reliably cope with the high torque output at low speeds.

  7. I hadn’t realised the Visa used gearbox in sump engines, most used the suitcase units from the 104.

    Many superminis had a diesel in the range in the 1980s, but these only seemed to make sense in markets where diesel was cheaper by a large amount.

    • The suitcase units from the 104 (etc) are indeed gearbox in sump engines.

      That’s why the gearbox whine sounds like an Allegro 😉 .

  8. The Metro was competitive when launched in 1980 as it was a similar size to its rivals, which were mostly three door hatchbacks, and British Leyland went flat out to ensure the launch was a success. At times, it was Britain’s best selling car and stopped the endless decline in Leyland’s market share and most reviews were positive. Even when it was finally replaced in 1990, the Metro was still in the top ten best sellers and had been Austin Rover’s most popular car in the eighties.

  9. These articles are the definitive history of BL – really thorough and great they’ll be kept on-line for posterity. Many thanks Ian and Keith.

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