News : November 2007

MG 3: for China’s eyes only?


The China Car Times and websites have both run recent reports on NAC MG’s launch of the MG 3 at last week’s Guangzhou Auto Show in China. claim that production of the MG 3 SW will begin in Q1/2008 but Ash Sutcliffe of China Car Times reckons that three versions are planned: the standard MG 3, the MG 3 Crossover and a more potent, 1.8litre-engined, MG 3 ZR hot hatch.

The MG 3 SW Crossover is clearly a reincarnation of Rover’s 25-based Streetwise but NAC MG do, at least, appear to have updated the interior.

However, neither Ash Sutcliffe nor A-R’s Editorial Team reckon that the MG 3 will be marketed outside China. Indeed, if the current negotiations in China result in the anticipated merger between SAIC Motor/Roewe and NAC MG, the MG 3 may well have a pretty short shelf-life.

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First Jaguar XF rolls off the production line


Michael Quinn and the new Jaguar XF

THE first production version of the Jaguar XF, a Vapour Grey 4.2 litre SV8, rolled off the production line at the company’s Castle Bromwich plant yesterday and has now been donated to the Jaguar Daimler Heritage Trust collection.

Michael Quinn, Jaguar founder Sir William Lyons’ grandson had the honour of driving the first XF off the end of the Trim and Final production line. He said: ‘My Grandfather would have been immensely proud today. The new XF is a car that truly represents the core values which have lain at the heart of this great brand since its foundation in 1922 and I am thrilled to have been asked here today to witness this historic event from the best seat in the house!’

Jaguar has invested significantly in the new facility at the Castle Bromwich plant to ensure that the new XF is built to even higher standards than the S-Type which was widely recognised for its excellent build quality and performance. Richard Else, Operations Director at Castle Bromwich, commented that ‘Today is a significant milestone for Jaguar and a very proud moment for the Castle Bromwich team who have worked tirelessly to ensure this car delivers the highest levels of quality and refinement customers have come to expect from Jaguar.’

The Jaguar XF will be exported from Castle Bromwich to 66 markets worldwide with the first UK customers taking delivery of their cars in March, 2008. The range starts with the Luxury 2.7 litre diesel at £33,900 rising to £54,900 for the 4.2 litre Supercharged SV8.

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Phoenix Four accused of stalling probe into Longbridge collapse

By JON GRIFFIN, Birmingham Mail

LAWYERS for the Phoenix Four have been accused of ‘running rings’ around DTI investigators as the inquiry bill into the collapse of Longbridge tops £10 million. Mid-Worcestershire Tory MP Peter Luff launched a stinging attack on law firm Herbert Smith more than two years into the DTI probe into the MG Rover crash in April 2005.

Mr Luff claimed at a hearing yesterday of the Commons Select Committee for Business, Enterprise and Regulatory Reform that the Phoenix Four and their legal team were delaying the inquiry deliberately. Mr Luff, who is committee chairman, said: ‘Are not the lawyers on the other side running rings around the process, and making a mockery of it?’

Secretary of State John Hutton asked if the chairman had evidence of this and Mr Luff replied: ‘It is what people are supposing is happening – that the lawyers on the other side are delaying the process deliberately. It is something your department needs to be very concerned about.’ Mr Hutton had earlier told the committee the MG Rover inquiry bill had ‘cost a great deal of money so far – about £10 million.’

He said he had no idea when the investigation might conclude. ‘It is a complicated issue and the investigators are having to talk to a very large number of people.’ The Phoenix Four – former MG Rover chairman John Towers, vice-chairman Peter Beale, Nick Stephenson and John Edwards – have all been quizzed by DTI investigators and expect to undergo a further grilling at some stage.

A Phoenix Venture Holdings spokesman said: ‘The inquiry is continuing and the directors are co-operating fully with the DTI.’ MG Rover collapsed in April 2005 with the loss of around 6500 jobs at Longbridge and thousands of others in the regional supply chain.

MG Rover: the whitewash file

Over two years have passed since the government launched an investigation into the financial affairs of MG Rover and its collapse – here’s the inside view on what the likely outcome will be, and why we’ll be disappointed.


Even before the car assembly lines at Longbridge fell silent and its 6000 workers finished their last day at MG Rover, the accusations begun – why had the company gone to the wall and should the men who were running the operation carry the can?

Considering the collapse of MGR happened in the final stages of a general election, the political implications outside of Birmingham were nowhere near as widespread as the government had feared. The news agenda soon shifted away from the loss of car production, despite the £6.5m aid that had been pumped into the company in order to keep it afloat during the campaign – and New Labour was ushered in for a third consecutive term.

The question of MGR’s failure was a complex one, and the government responded by setting up a parliamentary committee to investigate the collapse. In May 2005, a month after MGR fell into administration, the Department of Trade and Industry appointed Guy Newey QC and Gervase MacGregor as inspectors to investigate the government’s role in the affair, as well as the business methods employed by the four directors of Phoenix Venture Holdings (PVH), MGR’s parent company.

The depth of the mess, however, prolonged proceedings considerably – and a report, which many expected would have been completed in a matter of months continues to drag on, with taxpayers footing the bill. The newly branded Department for Business, Enterprise and Regulatory Reform (BERR) has taken over the DTI’s role in making sense of the MGR mess, and remain tight-lipped about when the findings will be published – however, speculation that the report was to be published last month proved to be wide of the mark.

Alan Duncan, Shadow Secretary of State for the BERR thinks it’s been long enough: ‘When Labour established the inquiry they wanted the inspectors to report ‘as quickly as possible”. Now more than two years later, the taxpayer has forked out nearly £10m, which is even more than the government spent trying to delay the firm’s collapse, and we seem to be no further in finding out what exactly happened.’

Richard Burden, MP for Longbridge, who informally gave evidence to the committee and offered to assist the inquiry, agrees that the results are long overdue. ‘My main worry is that when the report is published the focus will be on the cost of the inquiry,’ he said. ‘It was set up rightly under the Companies Act, and gave the inspectors all the power they needed to get to the truth – and I’ve been assured there are no allegations of a cover up on the part of the directors of PVH.’

‘However, the inspectors have told me they are being thorough, but over two years in; we still have no indication of when they will report. People need closure, and I would hate to think that the media focus will be on the cost of the inquiry,’ Burden added.

With that headline figure of £10m, and £300k being added to the tab every week, there’s real danger that the roles of the Phoenix Four, directors John Towers, Nick Stephenson, Peter Beale and John Edwards – along with MGR’s Managing Director, Kevin Howe, will stop being the news story. They could be reprimanded with as little as a slap on the wrist, while the government’s embarrassment of paying into MGR to keep it afloat during an election is played up.

According to one source that worked for MGR, however, the Phoenix Four should receive close attention. They did, ‘fly close to the wire,’ on occasion. ‘At the end of 2004, when the money was running out, I heard whispers that they were trading without liability – and that the premature announcement of the £1bn SAIC deal was nothing more than a bribe to persuade unpaid suppliers not to bail out on MGR,’ he said.

Michael Wynn-Williams, a motor industry analyst for the Cardiff Business School reckons that the Phoenix Four won’t be prosecuted as part of a whitewash – whatever the committee finds. ‘I think we’re asking too much of this and we’re all looking for scapegoats. In all likelihood, all the inquiry will find is a bunch of desperate actions by desperate men just before the company collapsed.’

‘Nobody’s going to come out of this with their reputation enhanced, but at the same time there will be no structural effect on how the UK economy is run,’ he added. ‘Either way, it’s gone on too long and has lost its relevance.’

However there are many who feel that the estimated £40m the Phoenix Four took out of MGR should be paid back. Richard Burden recalls one of the Phoenix Four’s broken promises. ‘I have no idea what they’re up to now, but following the closure, John Towers promised me he would contribute to the Longbridge Trust Fund for the unemployed workers. So far, no one’s seen any of that money. John told me that the Phoenix Four is unable to contribute money to the fund, but I don’t buy that. PVH is still trading after all.’

‘They made the commitment, and are now using the inquiry as a reason not to deliver – to me that’s another reason this affair needs to be wrapped up quickly.’

Paul Stowe, an ex-MG Rover executive who recently resigned as Quality Director of Nanjing Automobile Corporation, reckons the inquiry will be a whitewash, but hopes he’s wrong. ‘The collapse deserved to get a proper independent investigation, one that reviewed all aspects and alleged improprieties allegedly made by PVH.

‘When PVH purchased the company they were virtually handed the crown jewels of the UK’s automotive industry – I don’t think any of us expected them to pawn them off! I think the government owes it to all of us to publish what really happened.’

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Back from Japan: the return of the RV8s


Mike Rutherford, Telegraph Motoring’s Mr. Money, recently posed the question: ‘Ever wondered which cars will be the classics of tomorrow?’ British Car Auctions had, according to Mike, been doing exactly that and reckoned that, ‘the MG RV8 MG F and MG TF are likely to be admired by classic car enthusiasts in the years ahead.’

Colin Offley, the Proprietor of Wirral-based, certainly endorses British Car Auctions’ assessment of the MG RV8. Colin has been a life-long MG enthusiast and can trace his interest in the marque back to the former family business of Offley Brothers Limited which held a BMC>Rover franchise in Ellesmere Port, Cheshire for much of the last century.

Colin acquired his first MG, a Midget, when he was 17 and has owned a total of eight MGs since then. He still, in fact, has that Midget and a race-prepared Austin-Healey Sprite Mk1 which he campaigned in the Cockshoot Cup Championship run by the MG Car Club’s North Western Centre. See: However, having worked in the local Motor Trade for 17 years, Colin identified a niche for a classic and sports cars dealership on the Wirral and so founded in 2000. rapidly established a nationwide profile as a Mazda MX-5 specialist and, following a move to larger premises in September, 2005, the business now sells imported Mazda MX-5s in addition to UK-sourced versions. However, as a result of his extensive research into Japan’s used sports car market, Colin discovered that more than 75 per cent of the 2000 MG RV8s made by Rover Group Limited between October, 1992 and November, 1995 had been exported to that country. Indeed, Colin believes that only 307 MG RV8s were originally registered in the UK.

Colin was keen to combine his enthusiasm for the MG marque with his evolving business model and decided that re-importing MG RV8s from Japan was the best way of achieving that objective. Colin sources all his stock through auctions and only purchases cars with warranted odometer readings. Colin’s Agent in Japan, who is an ex-pat Brit, not only checks and bids for any cars which fulfil that criterion but also completes the complex Japanese de-registration procedure and arranges for the vehicles’ shipment to the UK. The whole process from purchase to delivery at’s premises in Neston on the Wirral normally takes two months. Registration in the UK then takes up to two weeks.

MG RV8s are, of course, UK-built cars with seventeen digit VIN Numbers and rear fog lights so Certificates of Conformity can be obtained. SVA Tests are only required for cars which were first registered less than ten years ago. Colin has only bought one MG RV8 of that age to date and the SVA Test was completed by Liverpool Technical Centre Limited, a VOSA-designated SVA Centre in Bootle, Merseyside, in less than two weeks. has imported a total of 23 MG RV8s since October, 2006. Colin and his colleague, Steve Lomas, have sold 17 of them to date and currently have six cars in stock with a further five in transit from Japan. Colin says that, up to now, the only mechanical items which have had to be replaced on several of the RV8s which he has imported were the front wheel bearings and the clutch master cylinder. Supercarclassics have also, where necessary, replaced any hoods and wood dashboards which have deteriorated in the Japanese heat and have sourced most of the parts required from Clive Wheatley, the well-known MG V8 and RV8 Parts supplier in Bridgnorth, Shropshire.

Any readers wishing to find out more about the MG RV8 should visit Jim Dolbel’s excellent website at Clive Wheatley’s website can be found at and the latest information about’s current stock of MG RV8s can be viewed at

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Roewe 550’s interior caught on camera!


There’s something vaguely BMW-esque about the curve of this dashboard… And the steering wheel is an almost unchanged RDX60 carry-over.

Shanghai’s Roewe 550 is shaping up to be very exciting car for the Chinese motor industry, and something of a watershed product. It appears contemporary beyond the flagship 750-Series, which is heavily based on an abandoned facelift proposal of the Rover 75 and MG ZT. We’ve already seen the exterior, which owes plenty to the RDX60 programme, but thanks to a quick camera’d enthusiast in China, we’ve had a chance to see what delights await us inside.

As can be seen from the accompanying images, there’s something of contemporary Germany about the interior, with BMW style dashboard architecture, and a control system that looks similar to Audi’s excellent MMI interface. Gone is the watered-down gentleman’s club of its larger brother, and in comes a Teutonically clinical look. The shifter for the automatic gearbox appears to hold no surprises – and it looks like SAIC is bypassing the now-popular steering wheel mounted selector.

It looks good, but the big question remains – will the quality be there? We’ll see soon enough…

Control layout looks logical enough…

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India’s Mahindra says it wants Land Rover technology


The manufacturer of this feels that purchasing Jaguar will give it a technical leg-up.

The technology of Land Rover, one of two luxury brands placed on the block by Ford Motor Co., makes sense for India’s Mahindra & Mahindra Ltd, Business Standard said today, citing a company official. Ford has been exploring a sale of Jaguar and Land Rover since June and said it expects to strike a deal by early next year at the latest for the two brands, which a Merrill Lynch analyst has valued at as much as $1.5 billion combined.

Sources have told Reuters that Tata Motors Ltd., as well as Mahindra with buyout firm Apollo, and One Equity Partners, a buyout firm funded by investment bank JP Morgan, are on the shortlist. ‘Work is in process. Anand [Mahindra] and Pawan Goenka are looking at options,’ Hemant Luthra, an executive director, was quoted as saying, referring to the vice chairman and the head of the automotive division.

‘The technology that Land Rover has makes sense for M&M,’ Luthra told the paper. Mahindra, India’s top utility vehicle maker, has a joint venture with Renault to make the no-frills Logan sedan, and is keen to sell its Scorpio SUV and pickup trucks in more overseas markets, including the United States.

Tata Group Chairman Ratan Tata has said they were interested in the brands to reduce dependence on the Indian market and for a more global presence for the company, India’s top vehicle maker.

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News digest



Cheaper re-maps for all thanks to XPart…

Ten percent power boost for MG Rover diesels

Owners of diesel powered Rover 75 and MG ZT models can now boost their engine’s performance by more than 10 percent with the relaunch of XPart’s XPower diesel upgrade. The enhancement, which is available through XPart’s 240-strong AutoService centre network, raises power by 15bhp, reducing the 0-60mph time by up to ten percent. Towing capability is also improved with a 15 percent increase in torque across a wide rev range.

XPart’s XPower diesel upgrades are performed using the T4 diagnostic equipment which was utilised by the original MG Rover franchise dealer network and is now standard across XPart’s AutoService centre network. To perform the upgrade, centres must order an installation pack which is unique to each vehicle. The pack contains a software CD, a one-time use ECU unlock code which is tied to the vehicle’s VIN number and an owner’s certificate of authenticity. Once the pack has been delivered to the AutoService centre the performance upgrade can be made in a matter of minutes.

XPart’s diesel upgrade pack is available from any of its 240 AutoService centre or its accessories website ( for £199.99 plus VAT and installation.

The sale of Jaguar and Land Rover

Indian paper’s sources expect Jaguar-Land Rover bidder shortlist to be cut to one next week
Auto Industry 16th November, 2007

Sources quoted by India’s Economic Times yesterday say that once the short-listed bidders for Jaguar and Land Rover— said to be Tata, Mahindra & Mahindra and One Equity — meet the British government and union representatives next week, Ford will begin negotiations in earnest with just one of them.

Ford announced its decision to invite bids for Jaguar and Land Rover in mid-July, and initial interest was reportedly expressed by the above companies and others including the private equity groups Cerberus, Ripplewood, and TPG. Then Mahindra & Mahindra was reported to have pulled out two months ago, only later to rejoin the bidders, while Ripplewood is now said to have pulled out.

Ford recently announced plans to enhance Volvo Cars’ profitability rather than sell the brand, and the Economic Times suggests that the company may also be reluctant to see Jaguar and Land Rover sold in a straight auction between two bidders.

China watch

Guangzhou to host auto show next week
By Zhan Lisheng, China Daily (HK Edition)

People in the Pearl River Delta region will get a chance to see up close sizzling and sexy car models and even sexier and more stunning automobiles with bewildering varieties next week in Guangzhou. The 5th China (Guangzhou) International Automobile Exhibition, also named Auto Guangzhou 2007, will open next Tuesday and will continue for a week at Guangzhou International Convention and Exhibition Center.

The exhibition will showcase the latest automobiles and even concept cars built by 400 automakers home and abroad, according to Tang Hanghao, deputy secretary-general of Guangzhou municipal government. Spread over 100,000 square meters, he said, the exhibition will be a stage for both global and domestic car brands.

European luxury car brands including Benz, BMW, Porsche, Ferrari, Bentley, Hummer will be there, so will be the Japanese luxury car brands including Lexus, Infiniti and Acura. Some foreign carmakers including Ford will also make its global, Asian or Chinese debut for their cars during the coming event.

Meanwhile, he said, domestic carmakers including Guangzhou Automobile Industry Group, FAW Benteng, Chery, Geely, Great Wall, Jianghuai, BYD Auto, Huatai, Brilliance China Auto, SAIC Motor, will also promote their own-brand cars or latest products. The official said that there will also be a summit forum on the development of China’s automobile industry during the event, with the theme centering round the scientific development of the industry and how China’s auto industry integrates with the world.

‘China’s vehicle market, which is the fastest-growing in the world and the second biggest, has proven irresistible,’ said Wang Xia, deputy director of the automobile branch of the China Council for the Promotion of International Trade. ‘The flourishing Pearl River Delta region is undoubtedly a market they can never neglect,’ said Wang.

Guangdong had 4.30 million vehicles by the end of 2006, up by 14.1 percent from 2005. The figure accounted for about one-third of the nation’s total, Wang said . The auto exhibition will be sponsored by the municipal government of Guangzhou, the provincial economic & trade commission of Guangdong, China Foreign Trade Centre, China Machinery Industry Federation and China Association of Automobile Manufacturers.


Maximum impact as Mini turns volumes way up
By John Cranage, Birmingham Post

Mini had a boom month for sales in Europe in October with registrations soaring by 67.5 per cent, according to figures from Brussels yesterday. The BMW-owned marque saw volumes grow to 12,281 from 7331 in the same month last year. Its percentage rise was by far the strongest. Among volume manufacturers, only Dacia, Renault’s Romanian budget brand, which rose by 27.4 per cent to 15,025 units came close to matching it.

Other strong gains were made by niche manufacturers such as Daimler Group’s Smart (plus 40.2 per cent), VW Group’s Bentley, Bugatti and Lamborghini brands (plus 29.8 per cent combined) and Fiat’s Ferrari and Maserati (up by an aggregate 21.6 per cent). Mini also increased sales in the 25 European Union countries plus Iceland, Norway and Switzerland by 25 per cent to 121,350 units in the first ten months of the year.

Mini, which launched the new Clubman variant last week, is looking to increase production at its assembly plant at Oxford from 240,000 vehicles a year to 260,000 in the medium term. It said sales rose by 60 per cent in France, 50 per cent in Switzerland and by 45 per cent in Germany, where the overall market fell by 4.1 per cent.

‘We are well ahead in all our key countries,’ a spokeswoman said. ‘Clubman only went on sale on Saturday so we should see a handful of registrations trickle through this month and we probably wont see huge numbers between now and the end of the year. We suspect, however, we will see sales of Clubman begin to ramp up as we move into 2008.’

Land Rover, which is on course for another record sales year thanks to the success of its new Merseyside-built Freelander 2 model, saw its sales increase by 14.3 per cent to 6599 units last month and by 7.3 per cent to 79,021 year to date. October was another poor month for Jaguar, which will soon be getting its new XF medium saloon car into the showrooms. Sales slid by another 24 per cent to 2152 and by 19.6 per cent to 28,954 over the first ten months of 2007.

The company, which builds three of its four models at Castle Bromwich in Birmingham, will know soon who its new owner will be as Ford completes the process of selling it along with Land Rover. Jaguar has been a financial drain on Ford for years, but its executives insist it is becoming profitable despite its prolonged slump in sales. That is because it long ago gave up chasing volumes in the most competitive sector of the global car market in favour of the higher margins that flow from selling fewer, but more profitable, high-spec cars.

Buyers of the XK sports car, for example, are said to spend an average of £6000 above list price on items from the optional extras list. Jaguar can take some comfort from the fact that Lexus, the Toyota luxury brand that has been making big inroads into its traditional market, suffered a rare reversal of fortune last month.

Lexus sales fell by 3.2 per cent to 2742 units and were 1.1 per cent adrift at 34,154 over the first ten months. Still looking at the luxury car market, BMW, which is still the world’s biggest maker of premium vehicles, gained 22.8 per cent at 61,306 in October and was 3.6 per cent ahead at 584,263 over the year so far. Its arch German rival Mercedes-Benz put on eight per cent to 63,100 cars last month and was 1.7 per cent ahead on 621,718 between January and October.

Acea, the Brussels-based European automotive industry body, said total registrations rose by 5.5 per cent to 1.321 million units in October and by 1.2 per cent to 13.572 million year to date. Last month’s improvement was due to one extra day throughout the Europe combined with a ‘general upswing’ in most of the main markets, Acea said. With the exception of region’s biggest market, Germany, where October registrations fell by 4.1 per cent following a rush to the showrooms ahead of a rise in sales tax late last year, most of the main European countries saw healthy gains.

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The news isn’t good at NAC-MG

Source: China Car Times

A NAC-MG insider spills the beans to China Car Times, and the news isn’t good, writes Ash Sutcliffe…

FOLLOWING hard on the heels of the news that the introduction of the Longbridge-built MG TF LE has been delayed until at least the spring of 2008, are a number of grim home truths for Nanjing’s venture back in China. We were left wondering about the future of NAC-MG following Quality Director Paul Stowe’s shock departure a couple of months ago, and the dark hints he made about the direction of MG under the soon-to-be new owners, SAIC.

According to Ash Sutcliffe of China Car Times, a deep NAC-MG insider has spilled the beans to China Car Times regarding the poor state the company currently finds itself in. According to CCT: ‘The inside source claims that the picture of the future MG prototype is nothing but a PR stunt from NAC-MG, and zero research and development work has been done since the fall of MG Rover.

‘Lotus finished its design contract to touch up the MG7 months ago; the only true R&D work going on in the NAC centre is on the range of IVECO minibuses.’

NAC-MG’s insider also went onto reveal that the company has received orders for a mere 600 cars to date (and only sold 300), despite the media claims of over 3000 vehicle orders and deposits since the launch of the MG7 several months ago. Demand is clearly not up to expectations, and NAC-MG is allegedly laying the blame on a lack of dealerships around China, and the current fuel crisis in China (which seems to have all but abated now).

The lack of sales has allowed NAC-MG staff have their first weekend off in two years as the factory has ceased producing cars last weekend. NAC-MG allegedly said the factory will stop producing due to the electricity company doing work on the powerlines in the area, however, the company next door, Dyson, experienced no power loss due to the claimed electricity maintanence. Furthermore, the source says production at the NAC-MG factory will be stopped temporarily next Monday and Tuesday, due to a lack of work.

Is this the MG curse striking again? Can MG play catch-up, or does it desperately need the help of SAIC now?

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Son-of-RDX60 breaks cover in China

Source: China Car Times

FOR all regular followers of the RDX60 and Roewe W261 project saga, the appearance of Shanghai’s new Rover-based model should come as no surprise whatsoever. The styling was previewed officially at this year’s Shanghai Auto Show in W2 Concept form, and the Internet is full of spy shots of the new car, which was barely disguised in more recent months. From as far and wide as North Eastern China for cold weather testing, and the hot summers of Australia for heat endurance, the new car has undergone a busy testing schedule.

Following the unveiling of the W2 Concept, SAIC’s Roewe brand has been creating an awful lot of interest in its domestic market. The feeling is that Roewe is a Chinese company that can clearly make the best of its British-based design and engineering talents.

However, these scoop shots clearly reveal that the productionised version – shorn of its concept detailing – emerges as a clean-cut, if slightly undistinguised design, but one which will chime well with the demands of its intended clientele. Recently confirmed as an evolution of one of the final Peter Stevens Studio designs for the RDX60, it gives a clear idea of what MG Rover had planned for the 75 platform had the SAIC-MGR Joint Venture gone ahead…

The new car’s appearance also finally puts paid to the debate over its name – early speculation had suggested it would be the 450-Series, but as CCT’s pictures clearly show – Roewe 550 will be the official moniker. Technically, there’s little we didn’t already know – the 550 will be powered by a 1.8-litre turbocharged version of the now-venerable K-Series engine – an engine that is now familiar to Chinese buyers following the recent launch of the Roewe 750 1.8T along with the budget-priced 1.8T version of the MG7. According to Chinese reports, the 550 measures in at (LxWxH) 4624 x 1827 x 1480mm, the wheelbase measures 2705mm.

Although there’s no official confirmation, it looks as though the 550 sits on the same platform as the original Rover 75 (as opposed to the 100mm longer Roewe 750), however according to reports in China, it is actually an entirely new platform that SAIC has created – so what is it, a new platform, or a re-hashed Rover? Either way, it’s a pretty and impressive first effort from what is emerging as China’s most progressive car company – and one that doesn’t take a huge leap of imagination to see sitting in European showrooms wearing MG badges.

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News digest special


The Sale Of Jaguar And Land Rover

The recipient of Autocar’s Design award, the XF’s launch might get overtaken by events. Deja Vu anyone?

Three to fight for Ford European brands

Ford Motor has narrowed the auction of its Jaguar and Land Rover brands to three bids, two of them involving Indian companies, people familiar with the matter said on Monday. Indian carmaker Tata Motors and rival Mahindra & Mahindra are both set to make third round offers for the British luxury brands. Mahindra & Mahindra teamed up with buyout firm Apollo.

One Equity Partners, a buyout firm funded by U.S. investment bank JP Morgan, is also on the list, the sources said. Ford is struggling with declining sales and a falling U.S. market share and announced last week it was nearing a deal to shed Jaguar and Land Rover. At the time it posted a third quarter net loss of $380 million, compared with losses of $5.2 billion a year earlier.

Ford has been exploring the sale of the brands since June as it continues a global strategic review, which led in March to the sale of Aston Martin to a Kuwait-backed consortium in a £480m deal. Mahindra & Mahindra, India’s top utility vehicle and tractor maker, initially pulled out of the process because it was only interested in one of brands, whereas Ford wants to sell them together.

The Indian company rejoined the auction after partnering with Apollo in a break-up bid that would give each one of the brands. Indian companies are becoming increasingly aggressive acquirers outside their home market as they seek diversification and growth. Tata Motors, India’s top vehicle maker, has a joint venture with Fiat to make premium cars for the Italian firm.

Ford invited six second-round offers earlier this month, people familiar with the matter said at the time. It has now evaluated them and selected the three parties it wants to fight for the businesses, the sources said. One of the sources said the bidders are now expected to enter talks with trade unions and the UK government about conserving jobs amid speculation some of the bidders may try to move production outside the UK.

‘We expect an agreement by early next year at the latest,’ a spokesman for Ford said. Ford declined to comment further.

Buyout firms TPG, Terra Firma and Ripplewood were among suitors that were expected to make second-round offers but were not on the third-round shortlist. Merrill Lynch analyst John Murphy at the time had valued the two brands at as much as $1.5 billion combined.

Jaguar may borrow labour for XF launch
by Tony Lewin, Automotive News Europe

Jaguar may borrow workers from sister brand Land Rover as it prepares for the launch of its key XF premium saloon next March. The XF was shown in its production form at the IAA in Frankfurt in September and replaces the S-TYPE, which dates back to 1999.

The two companies have separate factories in different suburbs of Birmingham in the British Midlands. Jaguar closed its Browns Lane plant in nearby Coventry in 2005. Jaguar and Land Rover had recently concluded an agreement with Unite, the labor union, said Land Rover spokesman Mark Foster. ‘The agreement provides for mobility of labour – what it gives us is flexibility,’ he told Automotive News Europe.

Under the terms of the deal, which last for two years, workers may move to a different location for up to 12 weeks at a stretch. Foster declined to say how many Land Rover employees would be loaned to Jaguar, but hinted that the numbers would be small – ‘probably between 100 and 200.’

‘The labour flexibility is there if Jaguar needs it,’ said Foster. ‘It will most likely be trackside assembly workers, but monthly-paid staff may move too.’ A company insider pointed out that quality standards are sometimes jeopardized by inexperienced temporary agency workers that are often hired for production starts. ‘It’s much better to have people with proper training and experience,’ said the insider.

Production systems at Land Rover and Jaguar plants are closely related, manufacturing specialists say. Foster refused to say whether the decision to call on the flexible labor would depend on the level of demand for the XF. ‘No decision has been taken. It depends on other factors, too,’ he said. The last S-TYPE came off the line on September 18. The first series production of the XF is November 26.

While Land Rover is enjoying record success, with over 192,000 vehicles sold in 2006, Jaguar continues to struggle. Jaguar sold only 75,013 cars in 2006. In June, parent Ford Motor put Jaguar and Land Rover up for sale.

Ford to stick with Volvo as a premium brand
By John Reed in London,

Ford Motor signalled its intention to keep a foothold in the globally buoyant premium car segment on Thursday by moving away from a possible sale of Volvo. The company had this year announced a strategic review of the Swedish marque that might have resulted in Volvo’s sale as Ford focused on turning round its loss-making North American operations.

Now, by choice or necessity, Ford is saying it wants to build Volvo’s position as a global premium vehicle producer. ‘Volvo is not for sale,’ Alan Mulally, Ford’s president and chief executive, told the Financial Times on Thursday. The move comes as Ford shifts into serious negotiations to sell Jaguar and Land Rover, its two remaining luxury brands.

Ford said it wanted Volvo ‘to operate on a more stand-alone basis’ outside its premium brands group. This group is expected to be disbanded after the carmaker sells the two UK brands by the beginning of next year. The US company, which does not break out individual results for its overseas brands, also reported an unspecified financial loss at Volvo, and said it planned to disclose the Swedish brand’s financial performance beginning with Ford’s 2008 results.

Pressed on the reason for shifting gears on Volvo, Mr Mulally spoke of Volvo’s ‘great products’, adding that Ford wanted to improve its productivity and cost structure. Don Leclair, Ford’s chief financial officer, mentioned unfavourable exchange rates and sales incentives – driven by intense competition – as factors behind Volvo’s quarterly loss.

Like other foreign carmakers, Volvo is under pressure from the weak dollar in the US, its biggest market. While the weak dollar and US pricing pressures also hit BMW’s latest quarterly earnings, Volvo can only be described as underleveraged compared with the German luxury carmaker and other upmarket brands. General Motors, Ford’s Detroit rival, has also failed to produce the kind of performance from its Swedish Saab brand as the best-in-class Germans.

While BMW plans to sell a record 1.4m vehicles worldwide this year and aspires to sell 1.8m by 2012, Volvo sold about 428,000 last year, down nearly 4 per cent on 2005. Ironically, improved performance at Jaguar and Land Rover helped to offset the losses at Volvo and narrow quarterly losses in the US carmaker’s Premier Automotive Group to $97m.

By dint of geography or its Nordic-flavoured image, Volvo, which Ford bought in 1999, has always stood somewhat apart from Ford’s other European brands, not to mention its core volume car business in the US. However, behind the scenes Volvo is even more integrated with Ford’s other operations than Jaguar or Land Rover, which might have made severing Volvo from Ford after a sale even more difficult. Several Volvo vehicles share production platforms with other cars built by the Ford, Mazda and Land Rover brands, and Volvo also procures and develops vehicles jointly with them.

Asked on Thursday about tentative sales talks before Ford’s change of tack on a possible Volvo sale, Mr Mulally said: ‘We certainly could have sold it, but we decided to keep it.’ Ford acquired Volvo in 1999 for $6.45bn. The company has relied heavily on Volvo as it seeks to globalise its design and production systems. Ford’s redesigned 2008 Taurus is built on a Volvo platform.

Ford expects Jaguar and Land Rover sale soon
by John Revill, Manufacturing Editor, Birmingham Post

Ford hopes to conclude the sale of Jaguar and Land Rover by early next year, the carmaker said as it reported a narrowing in third quarter losses yesterday. A shortlist of three bidders has been drawn up by the Detroit firm, which is now looking to take the sale to the next stage.

Rival Indian industrial conglomerates Tata and Mahindra & Mahindra are thought to have won through to the final stage along with One Equity Partners, the private equity arm of American bank JP Morgan which is led by former Ford chief Jac Nasser. Although Ford would not be drawn on the identity of the bidders yesterday, it said the sale of the two brands – which together employ 15,000 people in the Midlands – was making good progress.

Chief executive Alan Mulally said: ‘The company continues to explore in greater detail the potential sale of Jaguar and Land Rover with interested parties and anticipates these discussions will culminate in an agreement no later than early next year.’ Price is not thought to be the primary consideration for Ford, which is keen to protect its corporate image in the UK.

The update came as Ford posted a narrower quarterly loss of $380 million US (£181.3 million), compared with $5.2 billion (£2.49 billion) loss a year earlier. The results beat Wall Street expectations, although it was worse than the $750 million (£359.6 million) profit Ford reported for its second quarter, its first profitable quarter in two years. The turnaround included a small profit at the combined Jaguar and Land Rover operation, with the year-on-year improvement at the luxury brands aided by cost reductions and the non-recurrence of one-off items from the previous year.

The Premier Automotive Group (PAG), of which Jaguar and Land Rover are part, narrowed its losses from $508 million (£243.5 million) to $97 million (£46.5 million), although the performance was dragged down by losses at Volvo. The quarter saw the best ever sales figures for Land Rover, Ford said, helping PAG improve sales from $6.5 billion (£3.11 billion) to $7.4 billion (£3.54 billion). Higher sales volumes and prices partially offset the effect of the continued weakening of the US dollar against European currencies.

Mr Mulally said the company was confident of reaching its target of being profitable by 2009. But reports that the size of a pension deficit meant that Ford was likely to have to pay any buyer to take the brands were denied by the company yesterday. The deficit in the Jaguar fund has narrowed from £298 million in 2005 to £150 million in 2006, while the Land Rover pension scheme has seen its shortfall reduce from £135 million to £49 million. The performance of both funds is thought to have improved further this year.

A Ford spokesman said: ‘The Jaguar and Land Rover pension funds are maintained separately, but both are healthy and performing well.’

Ford is also conducting a strategic review of Volvo in order to improve the brand’s financial performance. But Mr Mulally said Ford was likely to hang on to the Swedish car maker, while concentrating on improving costs. ‘The most important thing we can do is improve the cost structure, but they have great products for the future. Our plan is not to sell it, but to focus on improving the cost structure and positioning of the brand itself.’

Ford bought Jaguar in 1989 for £1.6 billion and paid £1.7 billion for Land Rover in 2000. It sold another iconic PAG marque, Aston Martin, for £450 million in March. It is looking to sell the brands after it posted losses of $12.7 billion (£6.08 billion) last year – the largest deficit in its 103-year history. Jaguar employs more than 8000 staff in the UK, at sites in Allesley and Whitley in Coventry, Castle Vale in Birmingham and Halewood, Liverpool. Land Rover has the bulk of its manufacturing sites at Lode Lane in Solihull and Halewood near Liverpool.

The Relaunch Of MG

Nanjing delays MG TF launch
Tony Lewin, Automotive News Europe

Nanjing Automobile is switching to European suppliers from Chinese parts makers for some components of the MG TF roadster. The Chinese carmaker has delayed the start of production for the two-seat TF at its Longbridge, England, plant until next spring, partly because of delivery problems with parts from China. Production had been scheduled to start this autumn.

The company expects to launch the car in China in the spring, too, says a Nanjing source in China. Nanjing spokeswoman Eleanor de la Haye said: ‘A number of issues have combined to cause this delay.’ One problem is the logistics of shipping parts to Longbridge in central England from Chinese suppliers based 10,000km away.

For example, windshields and other parts have arrived broken, de la Haye said. ‘It’s not so much the quality of the parts,’ she said, ‘The quality of the packaging is not good enough.’ Martin Flynn, the head of Europe purchasing for Nanjing, said Nanjing has started sourcing some parts from Europe instead of China for several reasons, including logistics and lead times. Complying with European legislation and product patents is another reason.

The changes alter Nanjing’s original strategy. Originally, sourcing low-cost parts from China was a key part of Nanjing’s plan to price the TF competitively. Earlier this year the company said it would launch the MG 7 sedan, the MG TF roadster and the MG 3 hatchback in China in 2007. So far Nanjing MG has launched only the MG 7. It went on sale in September. In the first month of sales, 318 units have been sold, says consultant Auto Resources Asia. Nanjing says 4000 MG7s have been ordered with close to 2000 cars delivered. The car’s retail price starts at 172,000 yuan ($23,010).

Earlier this year, Nanjing said it expected sales of 13,000 MG7s this year.

SAIC, Nanjing Auto seen moving closer to merger

The parent groups of SAIC Motor Corp and Nanjing Automobile Group are close to completing a review of each other’s assets, bringing them nearer to a planned merger, an SAIC spokeswoman said today. ‘The two sides are in the final stage of their audits and asset evaluations, but still need to discuss technical details,’ said the spokeswoman, who asked not to be indentified.

‘There is no timetable for the merger,’ she added. A source familiar with the situation, however, said a deal could be sealed before the end of the year. ‘A decision could be made next month, as previously scheduled,’ the source told Reuters.

The source added that one option would be to fold the vehicle production assets of Nanjing Auto, owner of the MG car brand, into SAIC Motor, while Nanjing Auto’s components-related assets would be combined with SAIC’s parent, Shanghai Automotive Industry Corp. In return, Nanjing Auto’s state-owned parent would take a stake in Shanghai Automotive or its listed unit, SAIC Motor, the source said, although other possible shareholding and structural arrangements were also under consideration.

Nanjing Auto declined to comment. Nanjing Auto, which manufactures Yuejin brand light trucks as well as Iveco light buses via a commercial vehicle tie-up with Fiat, is currently owned by five state shareholders. Beijing has been encouraging consolidation in China’s fragmented auto industry, with more than 100 players, to create a few national champions able to compete with global giants at home and overseas.

The SAIC-Nanjing Auto merger, if it goes ahead as planned, would be the first major industry consolidation in recent years in China, the world’s second-largest auto market. The Shanghai Securities News reported today that Fiat had started to pull its employees from Nanjing Fiat, its loss-making car venture with Nanjing Auto, and a dissolution of the joint venture was imminent. A Nanjing Auto spokesman said he had not seen a massive pullout of Fiat employees from the venture and no decision on its future had yet been reached. He did not, however, rule out an eventual dissolution.

Nanjing Fiat is one of only a few foreign car joint ventures that has not taken off in China, where the market has seen rapid growth including a 30 percent surge last year to 5.18 million cars sold. The relationship between the Italian and Chinese companies deteriorated after Nanjing Auto unexpectedly took control of most of the assets of failed UK car maker MG Rover in 2005. Fiat CEO Sergio Marchionne said in May that he was unhappy with Nanjing Auto — which has been busy relaunching the MG brand in global markets — and was considering scrapping Fiat’s 50 percent-owned venture with the Chinese auto maker.

Both parties have made efforts to mend the relationship. In August, however, Fiat signed an initial joint venture deal with China’s Chery Automobiles to make 175,000 cars a year. The venture will produce and distribute Fiat and Chery brand cars, while Fiat will launch its Alfa Romeo brand in China. The venture is due to start production in 2009.

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Jaguar acquisition risks scratching Tata’s reputation

Joe Leahy in Mumbai and Amy Yee in New Delhi, The Financial Times

For a company considering what the market believes could be a transformational deal – the potential $2bn acquisition of Ford’s Jaguar and Land Rover marques – Tata Motors’ house is looking in less than perfect order. In the quarter ended September, net sales fell 1.5 per cent from a year earlier and profit after tax was down 25.9 per cent at Rs3.27bn ($83m). Margins declined 1.9 per cent year-on-year and market share in the car market fell 2.6 per cent. The market is not happy – Tata Motors’ shares are down 7.2 per cent since news of the possible deal emerged in July.

Some of these issues can be put down to a tough interest rate environment and a central bank clampdown on credit growth. But there are also longer-term problems such as increasing competition and a lacklustre product pipeline. Credit Suisse fears Tata Motors’ cash flow will face pressure this year – hardly good news for a company pondering a takeover of Jaguar and Land Rover, which together lost £159m ($331m) before tax last year.

However, to Tata Motors’ advantage is its membership of the cash-rich Tata group. As in the takeover of Anglo-Dutch steelmaker Corus by its Tata Steel unit, the Tata group could provide equity for any acquisition of Jaguar and ring-fence it through a leveraged buy-out structure sweetened to satisfy nervous credit markets.

But even if Tata group’s chairman, Ratan Tata, can easily afford to buy Jaguar, the less tangible danger is the potential damage to the normally conservative group’s reputation should the acquisition go wrong.

Tata looks at risky turn in UK move
By Joe Leahy, Amy Yee and John Reed,

When the Indian authorities decided two years ago to crack down on drivers who dangerously overloaded their trucks, there was an unexpected beneficiary: Tata Motors. Transport companies had to expand their fleets, leading to a sales boom for Tata, whose trucks are ubiquitous in India.

The rise in truck sales, combined with higher revenues at its much smaller car division, has provided the base for Tata Motors to begin looking overseas for acquisitions. Now Tata – after buying two British industrial icons in steelmaker Corus and Tetley Tea – has emerged alongside rival Indian producer Mahindra & Mahindra and US buy-out group One Equity Partners on Ford Motor’s shortlist to buy Jaguar and Land Rover, its UK luxury marques.

Tata Motors’ interest in the brands is said to be driven by Ratan Tata, the chairman of the Tata group. The carmaking unit is one of the conglomerate’s only businesses in which he has played a hands-on managerial role. A successful bid by Tata in the complex sale would give it a carmaking portfolio weighted towards two of the industry’s most profitable segments: small and luxury cars.

Ownership of the two historic brands would also mark a defining symbolic moment for any emerging-market carmaker and a technical leap for Tata, which is building its export business. However, bankers and analysts say Ford’s sale of the brands is fraught with financial and regulatory risks. In Tata’s home city of Mumbai, its bid has some shaking their heads.

The offer has come just as signs emerge that the Indian automotive market is entering a downturn and Tata’s competitive environment is about to become much tougher. Some worry that a takeover of Jaguar could even sink Tata Motors. ‘This deal would be a turn of the roulette table as far as Tata Motors is concerned,’ says one banker familiar with the group.

Founded in 1945 to make heavy vehicles, Tata moved to trucks only in the early 1990s, and took a decade to reach profitability. Mr Tata has big plans for the cars unit, including a plan to build the world’s cheapest passenger vehicle – the ‘one-lakh car’, which at current exchange rates would sell for about $2500. While projects such as the one-lakh car square with Tata’s competitive edge in low-cost engineering and manufacturing, the bid for Jaguar and Land Rover caught the market by surprise.

Aside from questions over Tata’s strategic fit with the high-end, low-volume UK brands, there is the challenge of executing what would be a fiendishly complicated transaction and integration process. Jaguar and Land Rover have a large unionised workforce in the UK, so Tata would have to tread carefully if it took the logical step post-sale of offshoring some of the carmakers’ design and engineering work to India.

But with private equity buy-outs under the spotlight in the UK – and Ford pressing bidders to make commitments on jobs and plants – the Indian carmaker would probably not move quickly. If it wins the sale, Tata would also take on the risk of further financial losses at Jaguar, whose future hinges on the introduction of two new models, an upgraded XJ and the new XF.

Even if these are successful, Jaguar could in the near term pose a severe cash drain on Tata amid signs it is losing ground domestically. Tata’s heavy truck sales declined 8.9 per cent in the second quarter of its year, ending in September, as the problem of overloading resurfaced. India’s higher interest rates have also dealt a blow to car sales.

Credit Suisse recently predicted Tata’s cashflow would come ‘under tremendous pressure’ this fiscal year. It forecast sales this year of Rs295.7bn ($7.5bn) against Rs271.2bn a year earlier on net profit of Rs17.7bn against Rs19.1bn a year before. Worse, the company’s core truck market is facing growing competition from formidable new entrants such as Daimler, Volvo and MAN while domestic rival Ashok Leyland has teamed with Renault/Nissan to target the light truck market.

Ford is expected to begin detailed sale negotiations shortly, and hopes to complete the deal by the year-end.

Additional reporting by Sundeep Tucker in Mumbai

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News digest


The Sale Of Jaguar And Land Rover

The XF may be desirable, but Ford still wants to sell JLR.

Private equity widens search
By Henny Sender and James Politi in New York, The Financial Times

Private equity groups are looking to boost deal activity by making greater use of alternative sources of debt financing including going to the sellers of the assets being bought, hedge funds, mutual funds and possibly sovereign wealth funds. Buy-out groups such as Blackstone, Carlyle, KKR and TPG have raised multibillion-dollar funds from investors in recent years and need to put their money to work. But to leverage their capital, they still need to secure debt financing from other sources.

The problem for private equity is that the world’s largest banks remain reluctant to make new funding commitments. In recent weeks, the buy-out groups have been responding by reaching out more aggressively to new classes of deal financiers, people familiar with such deals say.

In one example, private equity groups have continued to participate in the auction for Ford Motor’s Land Rover and Jaguar units because the US carmaker itself may be induced to finance the deal. The Land Rover and Jaguar sale is expected to involve a complicated trade-off between price – which could come in anywhere between $1bn and $2bn – and terms.

There are precedents for these kind of deals. As far back as 2002, a group including Bain Capital, Goldman Sachs and TPG bought Burger King from Diageo, the drinks conglomerate, using a loan from Diageo at a below-market 1.7 per cent interest rate. More recently, a similar type of vendor financing worth $1.5bn from Germany’s Daimler helped Cerberus seal its purchase of Chrysler as the credit squeeze hit Wall Street in late July.

The private equity firms buying Home Depot Supply from its parent in August were also able to extract guarantees on $1bn of debt from Home Depot itself as part of a renegotiation of that deal. Last week, Hellman & Friedman highlighted the new approach to dealmaking when it agreed to buy Goodman Global, a manufacturing company, for $2.65bn.

Financing came from an arm of General Electric, hedge funds Farallon Capital and GSO Capital Partners and banks such as Calyon of France that traditionally have not been big players in financing buy-outs. The financing for a rival bid included the backing of another hedge fund, Silver Point Capital. Investment banks say they are not unduly worried. ‘The issuers will find it complicated to find the least common denominator to bring syndicates together,’ says Tom Newberry, global head of syndicated loans at Credit Suisse Group, referring to the private equity firms.

‘It isn’t always so comfortable to leave their fate to a syndicate of diverse investors – any one of which might pull out at the last minute.’

Trio vie to secure Land Rover
By Russell Hotten, The Daily Telegraph

Ford is thought to have received just three ‘full and detailed’ offers for its Jaguar and Land Rover (JLR) operations, and the US carmaker expects to begin in-depth negotiations with these bidders early next week. Tata, the India-based industrial group, and private equity firms One Equity and Ripplewood, are said to have provided comprehensive takeover proposals by this week’s deadline.

Other private equity houses have submitted indicative offers, but the detailed proposals provided by the other three is seen as making them frontrunners in the race for JLR now that bid talks are entering a more important phase. ‘The others will have to play catch-up,’ said one source. After an initial burst of interest from a string of potential bidders, these buyers have become more cautious, first, because the credit crunch has made raising money more difficult and, second, because of a realisation that stricter European emissions rules may hit JLR hard.

Tata is not expected to have any trouble raising finance, and there have been reports in India that the company has submitted a non-binding bid of about $1.8bn (£865m). Ripplewood’s bid is thought to include details of the financing it has put in place. One Equity’s financing arrangements were unclear. Ford hopes to have a sale agreed by the end of the year, and the company’s review team will now draw up a shortlist of two bidders who can then go head-to-head.

Other private equity firms interested in JLR are TPG and Guy Hands’ Terra Firma. Cerberus, which bought Chrysler, may have decided against bidding, said a source. ‘There are only three full and detailed proposals on the table, but there are other firms still trying to talk up their book,’ the source said. Tata is favourite to win the bidding, as Ford would like to hand over the marques to an experienced automotive manufacturer, and the trades unions see the Indian group as less likely to close factories.

Yesterday’s news that Cerberus is to cut about 10,000 staff at Chrysler, America’s third largest carmaker, will do nothing to endear private equity to the UK unions who fear that job losses among JLR’s 18,000-strong workforce are most likely under a private equity owner. Of the buyout bidders, Ripplewood, whose bid is fronted by Sir Nick Scheele, a former president of Ford who was highly regarded when he ran Jaguar, has the best track record for investing in the automotive sector.

China watch

China regulates development of new automobiles
China Daily

China has made a substantial move to advance the development of automobiles powered by new energies amidst concerns on energy conservation and environmental protection. A new regulation regarding the qualifications of manufacturers for automobiles powered by new energies was promulgated Thursday by the country’s top economic planner, the National Development and Reform Commission (NDRC), after seven months of public discussion.

New-energy automobiles were defined by the regulation as hybrid cars — battery electric vehicles (BEV), fuel cell electric vehicles (FCEV), hydrogen-fueled vehicles and vehicles powered by other new types of fuel. Professor Zha Daojiong, director of the Center for International Energy Security at Renmin University of China in Beijing, told Xinhua the regulation came out against a background of increasing domestic and international energy demands.

The promulgation of the regulation coincided with the announcement of a sharp gasoline price rise by the NDRC. The prices of gasoline, diesel oil and aviation kerosene increased by 500 yuan per ton, a rise of almost 10 percent, to lessen the gap between soaring international crude prices and state-set domestic oil prices. The document said China would accelerate the research, development and production of new energy vehicles step by step.

Auto enterprises applying to manufacture vehicles powered by new energies should have adequate research, production and after-sales service capacities and need to ensure the reliability of the autos, it said. ‘Enterprises wanting to manufacture new-energy cars should pay attention that their development of new type of energies should be truly energy-efficient rather than only new in name, Zha said. “It is also crucial to avoid creating new sources of pollution in the process of the production of vehicles fuelled by new energies.’

Special testing institutions will be entrusted to supervise the quality of the vehicles powered by new energies, according to the regulation. To tap the country’s rapidly expanding car markets and cater to the government’s requirements on environmental protection, many domestic automobile manufacturers have already started research on new, cleaner energy.

East China’s Anhui-based Chery, for instance, has signed a strategic cooperation agreement with the China Petroleum and Chemical Corporation (Sinopec) for the latter’s technical support in developing green alternative energy vehicles. With an estimated 38 million motor vehicles on the roads, including 22 million private cars, China has a taste of not only the efficiency and convenience of modernization but also the harm this can bring, with damage to ecology and polluted air. Statistics from the Ministry of Construction showed that transportation accounted for 16.3 percent of the country’s total energy consumption in 2005. Moreover, more than 80 percent of the carbon monoxide and more than 40 percent of nitrogen oxides in air are from the car emission, figures from the State Environmental Protection Administration revealed.

Beijing, the host city for the 2008 Olympics, had 3.08 million automobiles by the end of August, the highest in China, and this figure is increasing by more than 1,000 a day. Professor Zha Daojiong suggested the government increase the tax on the use and consumption of high-emission vehicles, especially in big cities like Beijing, where roads would often resemble car parks during the rush hour. ‘

The government should impose higher fuel consumption taxes on the high-emission cars,’ he said.

As America’s development and production of ethanol, an alternative fuel to petrol, has boosted the global food price surge to some extent since last year, Zha said that the government must take social, economic and ecological factors into consideration in specifying the new energy development scheme. China has hoped to cut energy consumption per unit of gross domestic product by 20 percent, or 4 percent each year from 2006 to 2010. But, the consumption actually fell by just 1.2 percent last year, far from accomplishing the set goal.

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MINI tops the list of clean green cars


The website Clean Green Cars has published complete tables of sales-weighted CO2 performance for all manufacturers, models and segments in the UK up to September 2007. The tables reveal overall performance is improving, but slowly.

The average CO2 output fell from just 0.8 per cent from 116.1 g/km to 164 g/km in the first nine months of 2007 compared to the same period of 2006. The best performance came from MINI which cut its average CO2 by 17.1 per cent to 150.8g/km, partly due to the development of their highly efficient diesel engines and the incorporation of Stop/Start across the range. By 2008 MINI could have the lowest average CO2 output of any mainstream manufacturer.

Publisher Jay Nagley commented, ‘As CO2 performance is such and important topic it is vital to have accurate and timely information for the UK market. Clean Green Cars is the only independent body to publish this information, which is produced by correlating slaes of every single model in the UK with its official CO2 output to give a sales-weighted average.’

The full tables can be found by clicking here.

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V Eight to invigorate Jensen Interceptors


V Eight Limited, owners of the well-known Jensen specialists, Cropredy Bridge Garage near Banbury in Oxfordshire, will unveil a refurbished version of the Jensen Interceptor during next week’s Classic Car Show at the Birmingham NEC.

The Jensen Interceptor S begins life as a classic Interceptor from the 1970s and is then stripped down to the bare metal before being electrophoretically dipped for corrosion protection and rebuilt with modern lightweight materials.

V Eight Limited equip the Interceptor S with a General Motors 6-litre V8 LS2 engine producing 414bhp and a five speed automatic gearbox. The car also features independent rear suspension, AP six-pot ventilated disc brakes and 17-inch wheels with low profile tyres.

The company’s Managing Director, Steve Bannister, said: ‘The Interceptor S has taken us nearly three years to develop and we are very proud of it. Our aim was to build a powerful car that could take its place, once more, amongst the very best of British design and engineering. We believe that the Interceptor S can hold its own with any of the major competitors in the market.’

The production run of the Interceptor S will be limited to just 50 cars and each will cost £74,960. Each production slot can be reserved upon payment of £5000 which is refundable against a deposit once the car’s construction commences. The build process takes about four months from start to finish and the company aims to complete all 50 cars by the end of 2009.

More information can be obtained by visiting V Eight Limited’s website.

Keith Adams

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