News : Geely – sinner to saviour?

Carole Nash Classic Insurance Specialists

Andrew Elphick

London Taxis International TX4 (1)

The Administrators of Manganese Bronze – PricewaterhouseCoopers (PwC) – have confirmed that Geely has successfully purchased the assets of the London Taxi company for £11.04m.

The headline figure (equivalent to 345 new TX4 Style models) includes the Coventry-based factory, London’s Mann and Overton dealership together with satellite sites in Manchester and Edinburgh. The other assets which have been included in the purchase are the existing vehicle stock (new and used), goodwill and remaining stock of parts.

However, Geely has not purchased the remaining 80.1% of shares in Manganese Bronze. These shares are part of the administration process: Geely has simply tendered for what it wanted. Indeed, Geely is still the largest creditor. In a statement to press, Daniel Li, the Chairman of Geely UK, confirmed his company planned to use the Manganeze Bronze operation as Geely’s base for a European onslaught.

‘A solid foundation, not only for its location but also the Dealer Network,’ he said.

Quite whether this will lead to additional vehicle production in Coventry is unclear – the site there might just be a convenient oriental import’s PDI facility. The good news is that the current 107 employees will transfer to the new subsidiary, with existing MBH Group Finance Officer Peter Johansen becoming Executive Vice-President of Geely UK.

With production of the TX4 to resume shortly, Roger Maddison of the Unite trades union added: ‘They have plans for the future, let’s hope it’s another Jaguar Land Rover – with plenty of investment, we can have a real success story here in Coventry’.

London Mayor Boris Johnson remarked: “I am delighted that Geely has successfully secured the future of the London taxi company, ensuring the continuing manufacture of world famous, fully accessible and instantly recognizable vehicle synonymous with London,”. Geely confirmed rumours of a new compact Taxi. the ‘TXN’, possibly hitting the road as early as 2017.

Sadly, following Friday’s announcement, the final British-owned remnant of the once mighty British Leyland conglomerate now transfers abroad…

Keith Adams

Keith Adams

Editor and creator AROnline at AROnline
Created www.austin-rover.co.uk in 2001 and built it up to become the world's foremost reference source for all things BMC, Leyland and Rover Group, before renaming it AROnline in 2007.

Is the Editor of the Parkers website and price guide, formerly editor of Classic Car Weekly, and launch editor/creator of Modern Classics magazine. Has contributed to various motoring titles including Octane, Practical Classics, Evo, Honest John, CAR magazine, Autocar, Pistonheads, Diesel Car, Practical Performance Car, Performance French Car, Car Mechanics, Jaguar World Monthly, MG Enthusiast, Modern MINI, Practical Classics, Fifth Gear Website, Radio 4, and the the Motoring Independent...

Likes 'conditionally challenged' motors and taking them on unfeasible adventures all across Europe.
Keith Adams

21 Comments

  1. Well London without its black taxis wouldn’t be London, can’t imagine Citroen people carriers being the same. I just hope now the Coventry factory gets back to strength as this vehicle is a British icon.

  2. Is it heck! The TX4 is an outdated, uncomfortable old nail – screwed together from kits imported from China. I’d rather call Addison Lee and ride in a Galaxy.

    So, having bankrupted MBH by supplying chocolate steering boxes – forcing assembly to be halted and working cabs to be taken off the road – Geely now pick up what they wanted for a bargain price.

    What are the odds they’ve miraculously ‘found’ some functional steering boxes at the back of the factory…?

  3. I think this is realistically the best outcome we could have hoped for as UK assembly is retained.

    I now hope that Geely puts in some good management and the company has some stability for while and hopefully some worthwhile product investment (neither of which seemed to have been in place with the previous owners).

    It would be interesting to have the thoughts of the chap who was unfortunately made redundant a while ago and wrote the excellent article on this company a few weeks back.

  4. What’s this “goodwill” term that gets thrown about in company sales? How could you sell that off to someone else? Is it just pompous-squit talk for making it sound like you’re getting more than you really are?

  5. Goodwill surely means things like having a product that Boris Johnston can describe as world famous, fully accessible and instantly recognisable and synonymous with London. It means people will buy it because of what it represents, not what it really is and it has a value because of that. If they where simply selling the nuts and bolts of the company they would be offering an old factory building a dated vehicle that has been out of production for months because of safety concerns. You’d probably have to pay someone £11.04m to take it off your hands.

  6. At least the current 107 jobs are safe and TX4 production will resume at least for the short term. A JLR style investment in a future London Taxi is hardly certain but for the moment I don’t think we could have hoped for much better.

    David @ 2 – The TX4 may hardly be a modern piece of automotive design but I think ‘old nail’ is a bit of a harsh description. Practically, there are still obvious advantages as a cab – tight turning circle, ease of ‘off street’ access when laden with luggage… Also, don’t forget there is a financial advantage attaching to its ‘a piece of London’ image.

  7. Goodwill is normally assumed as equipment that has a value to the new owners but is other wise worthless to anyone else – Brochures, company stationary, existing HR system, adress book and supplier contracts etc.

    I have no blame myself to lay at Geely’s door – it seems as an outsider they (MBH managemnt) were given a golden opurtunity which in the spirt of the Phoneix Four they squandered away by alienating their core (and only) market of badge holding cab drivers, by delivering an outdated product, refusing to act on intrinsic problems (such as fires…) and generally aping the generations of old boys network bad management previlant in Britain since the aftermath of WW2.

    I think the public carriage office should sit on the naughty step to for helping to nuture this runaway contempt also.

  8. I like the look of the taxi but they need to lower the running costs. A bespoke design could be made perhaps with a hybrid drivetrain or electric which would work well in London.

    It’s a small market though so Geely must have plans for world domination.

  9. Surely it wasn’t just the chocolate steering box that spelt the (temporary) end? The problems appear to run far deeper than that.

    Shades of the whole MGR/SAIC story can be seen here.

  10. Better a trraditional London taxi than a French people carrier transporting people around, it’s not the same. But they really need to make the taxi more modern so it can compete- locally most taxis are Skodas or SEAT people carriers.

  11. We’d all like MB to still be in British hands, but we have to face facts & realise that was unlikely. But at least the company is a going concern & the people employed there look to have a future.

    The steering boxes may have been a way to send the company to the wall. Just like what happened to MGR when the Chinese held out for the IPR’s, knowing the company was going to the scrapper without their help. If you read articles from 20 years ago on how the Chinese took tech from many companies wanting to set up there, it makes sense.

    But at least these companies are still operating, unlike MGR. If the Chinese hadn’t stepped in, it hurts me to say, they’d be extinct.

    At least as things stand, Brits are employed & who knows? Perhaps one day they can be bought back to UK ownership. The world is fluid & maybe UK Plc can become a Phoenix…

  12. Well far Eastern/Indian companies have been the saviours of what remains of our car industry. The old big four, apart from the Astra, make nothing here now and it’s largely Asian companies that have saved our car industry.

  13. The ‘black cab’ is a thing of the past anyway as they are often shrink-wrapped with garishly coloured advertising. Hopefully they can make it more competitive as it isnt terribly economical compared to the opposition. I must admit, I thought they would be a lot more expensive than £32k although in this day and age air con should be standard fitment surely – not that any cab drivers put theirs on during summertime as they have the mistaken belief that it uses loads of fuel and just having all the windows open is much more economical.

  14. As an former employee of The London Taxi Company , these are a few facts relating to the steering box issue.
    A company called ADWEST produced the steering boxes for the Fairway, TX1, TX2 and TX4, was BRITISH made and was a quality item. The Box that caused the company to enter administration was CHINESE and was of questionable quality.
    You have to ask a question. Why did production of the TX4 get halted in the UK and not in China ? I smell a rat !
    Don’t misunderstand me . I could see the reason behind sourcing parts from China but, I think that the company took it’s eye off the ball when it came to major components like the steering boxes.
    As for the under bonnet fires. That too was a poor component not produced in the UK that was part of the EGR system on the Italian VM engine.

  15. Andrew , well its a tough one that. I enjoyed working for LTI , and I can say that before Geely torpedoed them below the water line that if all had gone to plan the out come could have been different. In last months blog, Matt gave a very indepth and interesting view from someone who worked in the assembly plant in Coventry . I have to say I am pleased that the future for the remaining employees in Coventry and the two dealerships in London and Manchester in the short term has been secured.
    Geely have now got to get their act together as they are now in charge of a product that has been tarnished due to recent events. How can they build the confidence of the poor cabbies out there who bought a product back in September only to find it taken off the road. The TX4’s not affected by the safety recall ended up with no warranty during the administration period.
    I know a little of Geely’s grand plan but, have to be descreet in that area. I do agree that the TX4 needs a good plan for the future . The passion and vision to do it is all up to Geely. Are they up to it ? Well I do hope so as I still have friends that work for the for the new company.
    As long as the plan is better than the one currently being used in Longbridge .

  16. Surely two of the reasons for the absolute need of a purpose designed Taxi – as apposed to using stock people carriers – is the turning circle as mentioned by others and the flat-floor bus-like room inside. Room which is really essential to allow people of all shapes and sizes – and the disabled – to ‘walk in’ and move around freely – and quickly if the driver has stopped on yellow lines.
    No current people carrier comes close no matter how convenient the Espace, Galaxy or any other blobby thing might be. As for the bigger stuff – I don’t really want to arrive in Merc van with windows in – no matter how they have clothed it or what fancy name they have given it.

  17. 20 The wolseley man. I totally agree. At the end of the day ,a van is just that , a van. The TX4 is the only purpose built wheel chair compliant TAXI out there .

    Come on GEELY develope it !

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