Richard Williams, a Director of Caterham, Lotus and Morgan dealers Williams Automobiles Limited, shares his BMC>MGR history and gives his very frank prognosis of the future prospects of MG Motor UK – he also exclusively reveals an aborted plan to put the Rover 800 back into production!
My family business has been involved with MG almost from its inception. My grandfather, who started his automobile retailing business in 1911, was already a retailer for Morris products when Cecil Kimber founded MG. Quite soon, as well as Morris, Austin and Riley, MG joined the list of marques our company sold and, due to its sporting appeal, became one of the favourites.
My father always drove MGs from the badge-engineered MG Magnette when we were a young family to the MGB GT when he no longer needed to ferry the family around.
I suppose it was only natural then that, not only did I followed in his footsteps, but I became even more involved with MG as an apprentice with the British Motor Corporation which, by then, owned MG. As well as working at the Longbridge factory, I was also seconded to the MG factory at Abingdon to build MGs. My own cars were always MGs from Midgets to Bs – I even used a B for my honeymoon.
Anyway, having started my apprenticeship with BMC, I ended it with British Leyland which turned badge-engineering into a fine art. After a year or so of travelling with no particular career in mind, I started in the family business selling the cars that British Leyland was producing and the first car launch I attended was the Allegro with its square steering wheel – at least the MGB was still in production, so I had something interesting to drive!
The following years were spent trying to sell some terrible products as the British Motor Industry fell apart. The MGB ceased production and the MG name was used on Metros and lemons like the Maestro and Montego. My father, who had been loyal to BMC, would always be told by the company’s Sales Managers that, while the cars being produced were challenging to sell as their market share collapsed, there were great cars coming and, although it was bread and water today, there would be ‘jam tomorrow’ for the retail network.
However, in the mid-1980s, I realised that there was not going to be a happy or viable business career selling the models that the, yet-again-renamed company now called Austin Rover produced so, after six decades of our company selling the MG brand, to stay in business, we had to change direction and that change was to Saab. We likened it to MG, a sporting brand producing interesting niche, high-quality drivers’ cars. We were taken to the High Court to prevent us from leaving Austin Rover but resolved the issue with an-out-of-court deal.
I thought, at the time, that was the end of my association with MG – with the exception, that was, of the MG TA which I still used daily on fine days in the summer.
Now representing a profitable brand, my company prospered and increased in size selling other niche brands in addition to Saab – at various times, the company also held franchises for Isuzu, Lotus, Mazda, Morgan, Noble, Proton, Skoda, Subaru, Suzuki and TVR.
I always followed the fortunes of what became the Rover Group closely. The takeover by BMW was a mystery to me at the time. With new investment and renewed pressure on the retail network to increase the volumes, the brands were too tarnished and the products not exciting enough to achieve a return on investment. It became obvious that BMW had to divest itself of the company and, after taking the strong brand of MINI and certain technology, the well-documented sale to the Phoenix Four took place.
At the time this was all happening, I had become convinced that, due to congestion and pollution, the future of private vehicles for large cities lay in electric and hybrid powertrains. This would be driven by government legislation and grants. My company therefore looked at the opportunity of developing one and I travelled all over China looking at any technology they were developing which might be useful in the development of electric vehicles. I was never involved with SAIC Motor but did meet with Geely and several other smaller motor companies, all of which were looking to acquire traditional car manufacturing skills and opportunities from the UK. That, in turn, led to an unexpected turn of events…
Back in the mid-2000s, when it was becoming obvious that MG Rover could not survive in private ownership, I was approached by a Chinese consortium to try and buy the manufacturing rights and the body presses for the old Rover 800 model. That’s how, nearly 50 years after I started working in the West Works at Longbridge with thousands of other employees, I returned to the same building with a group of Chinese to view the presses and dies which had been removed from the Swindon factory and had been stored rather forlornly there. It was a strange feeling – I was also dealing with MG again…
However, as Honda part-owned the IPRs, we could not reach a satisfactory agreement and, a couple of weeks later, Nanjing Automobile acquired the MG Rover Group’s remaining assets from the company’s Administrators, PricewaterhouseCoopers.
Anyway, several months later, MG’s new Chinese owners were trying to work out a viable business plan and, because of the experience my company had in retailing niche sports cars including the Mazda MX5, I was invited back to the Longbridge factory in order to discuss pricing and marketing for the MG TF which was going to be built there. Walking down the silent production lines was a very strange feeling – half-built cars with parts waiting to be assembled lying beside the tracks but nobody there. My thoughts turned to the enormous effort in not only getting these lines rolling again but recreating a dealer network to sell the volume of cars needed to give the whole operation viability.
After a good meeting, I thought the MG TF had a potential viability as a niche sports car and decided to apply for an MG franchise. However, having seen the terms and conditions, it quickly appeared to me this was not going to be a viable option. Moreover, with Noble, TVR and, in particular, Saab all running into financial difficulties at around that time, the whole retail market was changing so my mind was focused elsewhere.
How can the remaining parts of the Longbridge factory be resurrected without an enormous investment both in money and people? CAB1, CAB2 and other buildings remain but the necessary skills have dissipated with the available workforce either retiring, finding different jobs or being absorbed by the enormous success which is Jaguar Land Rover and a relatively easy commute away.
What would be the logic of shipping either the individual parts or a KD kit from China to an import centre in Bristol and then transporting them on to Longbridge for assembly and, with the volumes needed to even start the lines, how would the current retail network achieve these volumes and what products would they do it with?
The Chinese are very certainly not stupid and are in business for the long term. I am sure that they are now realising that, in the longer term, the Longbridge factory as it now stands cannot really be a part of the future of MG unless substantial Government grants are made available. However, the recent Brexit situation must cast a very large question mark over this. Their best option is to leave the site for St. Modwen to develop. It is prime real estate now and SAIC Motor could relocate its UK operations either to the import centre or, if the company really is determined to build cars in the UK, to a site Wales where the available grants would make for a more viable business plan.
MG Motor UK is currently shipping the cars from the Chinese factory directly to Portbury Dock and then distributing them from there – that is completely logical. The existing infrastructure is already in place and there is an available workforce to customise the vehicles for the UK market. The supply tap can be easily adjusted up or down as sales dictate.
The Chinese have also been clever in exporting their home-built cars to less-developed countries that will accept a lower build quality than the much more developed European market while they continue to improve their build quality. The cars I saw in China 14 years ago were far worse than the British Leyland cars of the 1970s.
However, the current situation poses several questions for the future:
- What does the MG brand now mean to the car buying public?
- Is the current product quality good enough for the modern consumer?
- What marketing is required to re-launch the brand?
- What retail network is required and what should MG do to ensure these retailers are viable?
- What new products are required to revitalise the brand?
Here, then, is my take on the future from a retail perspective…
What does the MG brand mean to the young consumer at whom the marketing is being targeted?
Well, not a lot. When the current thirty year olds with a young family were in their formative years the exciting cars were all hot hatches or big-engined TVRs and sporting Italian products. Back then, MGs were seen – and this includes the MGF and TF – as being for older people, so would these current consumers put an MG GS on their aspirational purchase list? I rather think not. Do the children of these purchasers think the cars are cool and would love to be seen being dropped at the school gate in one? Not a hope… so how do you sell a car to a purchaser whose kids don’t rate it? Well, very probably, with extreme difficulty…
That said, the brand still means something to the fifty-plus market and that would, in fact, appear to be the age demographic shared by many of those who have bought new MGs since the MG6 was launched back in 2011.
Marketing and Product Placement
MG Motor UK’s advertising and marketing should, perhaps, be aimed at the silver market at the moment – after all, they are the consumers who not only remember MG and but also have the disposable income to buy one and would put up with questionable quality. Maybe, a campaign with Saga would be the thing. The MG GS is a high-seated car so you do not have to bend down to get in it, it does not have the four-wheel drive which the older market does not need and it’s petrol-engined so it is much more acceptable for the lower-mileage market. However, this market is literally a dying market, so what of the future?
Product Quality and Durability
A member of AROnline’s Editorial Team recently arranged for me to examine a new MG GS in the metal and I would say that the overall build quality is just about acceptable. The shut lines are not yet perfect and the plastics used are not of the best quality and don’t smell particularly enticing. It might be acceptable for the grey market but the more discerning younger market will be more of a challenge. It will be interesting to see how the carpets and plastic trim cope with the rigours of a modern young family but, from my experience, I think the interior might look quite tatty, quite quickly. It is interesting that nearly all the leading UK-based motoring titles have given the MG GS mediocre reviews with a capital M.
Unfortunately, there is nothing on the GS to make it unique and stand out from its competitors in a fiercely-fought niche. Moreover, with the current oversupply in the market, the price will also be relatively uncompetitive if there is a glut of pre-registration on better, well-known competitors. Manufacturers also tend to forget that used examples of more expensive models are competitors for their own new products – given a choice between a new MG GS and a fairly recent Land Rover model, I know where my money would go…
MG Motor UK should treat all its retailers as its best customers and be thankful that they are investing their time and money in representing MG. I would surmise that, at the moment, the most successful retailers in the current network are those with their own, well-established local brand – in short, those where the customers’ trust in the dealership outweighs any preference for a particular manufacturer. I would roll the red carpet out for my retailers, incentivise them and make them feel that they are important members of an exclusive club. BMW, Saab and many other niche manufacturers were good at this in the 1970s and 1980s but it seems to be forgotten now with retailers being perceived as being just a conduit to stuff more products into.
So What of the Future?
MG’s UK model range currently consists of just two models: the MG3 and the MG GS – that does not provide a great platform for the future and, if I were a retailer, would I put my time, effort and money into the brand? I think it’s a question every retailer should ask themselves. Another key question is this: what new products are coming and will they be competitive enough to excite the market place and carve a profitable niche not only for MG but for the retail network as well?
Sadly, based on the evidence to date, I really do not think that MG has a chance in the UK and, with the declining (hopefully temporarily) value of Sterling, I could see MG following the likes of Daihatsu, Proton and several other marques which have disappeared from the UK market.
However, SAIC Motor is a massive company with substantial resources so how about investing in niche vehicles that will suddenly become mainstream and perhaps catch the current traditional car manufacturers out? In a few years, the cities will be full of funky, well-thought out and designed electric or hybrid vehicles. They will come from new entrants to the market such as Apple, Google, Tesla and, if the rumours are correct, Dyson and the current car manufacturers will say “what happened?” Here’s a thought, though: if MG was one of those funky new entrants to this potentially huge Government grant-driven market then, for the retailers, it could possibly be ‘jam tomorrow’ but, until that happens, I’m afraid it will continue to be bread and water as it has been for the past 30 years.
[Editor’s Note: Richard Williams is still a Director of the company founded by his grandfather 105 years ago, Williams Automobiles Limited, and represented the smaller retailers on the National Franchised Dealers Association’s National Executive for many years. The company, which was highly commended in the Best Dealership category of the 2014 Automotive Management Awards, currently has franchises for three of the UK’s leading low-volume sports car manufacturers, Caterham, Lotus and Morgan.]