In 2009 Jaguar cars unveiled the latest XJ saloon against a background of world recession and uncertainty about the financial strength of its new owners, the Indian conglomerate Tata. The whole story of the company since the October 1973 energy crisis has seen more downs than ups and the dreams that founder Sir William Lyons could create an organization to rival Mercedes now seem to be just that, dreams, an impossible fantasy. Where or when did this plan turn sour?
Conventional wisdom is to put all the blame on British Leyland, probably at the moment in 1974 when Lofty England, who had succeeded Sir William Lyons as Chairman in 1972, resigned to be replaced by Lord Stokes’s nominee Geoffrey Robinson. Quality is then supposed to have gone down the toilet before John Egan came to the rescue in 1980. With repeated telling, this story has become accepted as fact, but is it really true. And if Jaguar was so successful in the 1980s as the media kept telling us at the time, why did it need rescuing by Ford in 1989, who then went on to pump large amounts of capital into it?
Perhaps we should look at the Jaguar story another way, that the company was a small scale manufacturer which because of its Le Mans victories, had punched above its weight with a series of stunning production cars, but times were changing and it lacked the resources to fund future developments which resulted in a series of corporate and engineering blunders.
The cars , pre-Ford , were developed on a shoestring, and it showed in quality and reliability issues. A series of benefactors have kept Jaguar on life support since 1966, when in reality it was to small a concern to survive for long as an independent company. The evidence is all around us on our roads, dominated by the German executive and luxury car brands.
In 1959 Jaguar produced 20,876 cars. The following year, 1960, Daimler was purchased, which allowed Jaguar to use the Radford, Coventry plant as its engine factory, freeing up more production capacity at Browns Lane. This seemed to do the trick as annual production from 1961 to 1967 now averaged 24,018, but in reality this was still to small. With the purchase of Daimler came two excellent Edward Turner designed V8’s, a 2.5 litre and a 4.5 litre.
Jaguar’s uncompromising pursuit of engineering excellence would win many fans, but the forthright opinions of its senior engine men would also lead to some very costly diversions.
The engine men at Jaguar had no time for V8 engines. In their opinion the V8 configuration could not match 6 and 12 cylinder engines for smoothness and refinement and the matter was closed. The 2.5 litre Daimler V8 did find a home in the badge engineered MK2 based Daimler Sovereign from 1963, which was actually faster than the equivalent 2.4 litre XK engined saloon. Reviewing journalists also commented how the Daimler powered car was also smoother and more refined than the XK engined MK2…
At one stage William Heynes advocated enlarging the larger Daimler V8 from 4.5-litres to 5-litres, but somehow this idea bit the dust. Jaguar had inherited two engines that could have served them well, but the “not invented here” philosophy won out. In allowing the ego’s and prejudices of senior engineers to dominate product planning, Jaguar was not alone. Over at BMC Alec Issigonis had become Engineering Director and his disdain for market research, styling and interior ergonomics would nearly lead to disaster.
Sir William Lyons was the majority shareholder of Jaguar and he ran the company in an autocratic manner. Board meetings merely served as a way of rubber stamping Lyons decisions. He was a distant and remote man who ran his company in a penny pinching fashion. Industrial relations at Jaguar were in reality appalling, with one Trade Union official later describing working conditions at the company as the worst in the UK motor industry. One can’t imagine Sir William, a card carrying member of the Conservative party, spending much on employee amenities.
The workforce had little respect for their boss, and were quite willing to to walk out on a wildcat strike, even if it meant losing pay, in order to spite management. In reality all those beautiful Jaguar cars were assembled on a second hand production line, which was pre-war in origin, by a disgruntled workforce. How could a quality car emerge from such an atmosphere ? In reality it couldn’t, and although UK buyers lapped up Jaguars, in the important American market, buyers had a love/hate relationship with the Coventry marque. American customers loved the performance and refinement of the Jaguar, but hated the unreliability of the cars. And this was well before British Leyland was formed.
This perhaps explains why Jaguar production stagnated at around 24,000 cars a year in the 1960’s. For all the customers won over to Jaguar ownership, there were plenty who were alienated by the experience.
By the time Ford realised that more modern styling was needed, the corporate will had evaporated and Tata stepped in to buy Jaguar Land Rover.
But can Tata really succeed where Ford failed?
In 1961 Sir William Lyons became diverted into the commercial vehicle business when Jaguar bought out Guy Motors from the receiver. Perhaps Lyons was envious of the profits of the Leyland group of companies and wanted to emulate their success ?
1961 Was also the year of the launch of both the E-Type sports car and the Mk 10 saloon. The bulbous Mk 10 was the least successful Jaguar of all, only 24,175 were produced in its 9 year lifespan. But what did it cost to develop the MK 10 and did it pay its way ?
The Jaguar E-Type became a motoring icon, but it was probably underpriced. Dealers actually asked Jaguar to add £100 to the price in order to add more quality and reliability to the car. American buyers may have had to pay more for a Chevrolet Corvette, but they got a reliable car for their money.
Jaguar continued its programme of acquisitions, buying out Coventry Climax in 1963 and Henry Meadows in 1964. The purchase of the former resulted in the return of Walter Hassan to Jaguar where he was joined by Harry Mundy from Autocar magazine.
By the mid 1960’s Jaguar had a ludicrously ambitious future model programme with the XJ4 saloon, XJ21 E-type replacement, XJ27/28 GT and a MK 2 replacement all slated to appear. The brutal reality was Jaguar did not have the resources to afford the XJ4 programme, let alone all the other projects.
Although it has been said that Sir William Lyons sold out Jaguar to BMC in July 1966 to form BMH to safeguard his body supply and because he had no one to hand the company down to, the truth is that unless Jaguar found a wealthy investor, it had no future. BMC stumped up the £6 million to fund the XJ4, which was launched in September 1968 as the acclaimed XJ6 saloon. The XJ6 was a gamble that seemed to pay off at first, with Browns Lane bursting at the seams. Jaguar abandoned the smaller luxury/executive market to Rover, Triumph and BMW and concentrated all their eggs in one basket, a 2.8 litre and above XJ basket.
In 1968 Jaguar became part of British Leyland, a merger Sir William Lyons voted for and in 1971 the company announced its 5.3 litre V12 to instant applause. Costing some £3 million, the engine would enjoy a brief honeymoon before the October 1973 energy crisis exposed it as an expensive folly that had used up precious development funds.
As related earlier Jaguar had rejected using a 5 litre version of the Daimler V8. The company then devoted resources in developing a road version of the XJ13 racing engine, a V12.
The XJ13 engine was a 5 litre unit and in order to achieve volumetric efficiency it was enlarged further to 5.3-litres. As an afterthought, Jaguar decided to try and develop a 60 degree V8 version of the V12 to replace the XK engine, which ultimately failed. The upshot of all this was that a great deal of effort and money had been expended trying to develop a range of engines to suit all Jaguar’s future needs and all they had to show for it was a gas guzzling V12 that only a minority would buy. The funds would still have to be found to develop an XK engine replacement.
This episode illustrates how prejudiced Jaguar’s engine men were against the compact V8 configuration, which allowed more room to insulate the bulkhead against engine noise entering the passenger cabin.
Also by 1967 Jaguar knew that American Government legislation restricting engine emissions was coming into force, something the V12 engine was vulnerable to, but still they blindly ploughed ahead.
In the 1990s Aston Martin showed how to develop a V12 engine on the cheap by joining two 3 litre Ford V6 Duratec engines end on. Why didn’t Jaguar develop a V6 and then join two together to make a V12 ?
Sir William Lyons retired in March 1972, and in September 1973 Geoffrey Robinson arrived. Robinson, a Labour party member, something that would not have met with Lyons approval, soon realised that Jaguar would have to expand to survive. The only way to become self financing was to make more cars to make more profit. It was entirely logical. Unfortunately it was the October 1973 energy crisis that was the hammer blow to Robinson’s plans from which Jaguar never really recovered. The window of opportunity had passed.
Demand for Jaguars dropped dramatically, and with the demise of the 2.4 litre XK and 2.5 litre Daimler engines, the company didn’t have any more frugal cars to offer customers, unlike BMW and Mercedes.
The XJ-S was launched in 1975 as an upmarket GT with a greater profit margin than the outgoing E-Type. Although the styling of the new car was controversial, the XJ-S soon exceeded its production target of 3000 per year. I argue that with the passage of time, the XJ-S’s styling became its greatest asset as it matured. It developed its own brand values and continued to pay its way as later Jaguar’s faltered in the market place. The biggest problem with the XJ-S in its early years was not its styling but getting it to stay together.
By the time the XJ-S appeared, Jaguar had a new benefactor and until 1984 the British taxpayer would foot the bill for major projects.
In the late 1970’s demand for new Jaguars recovered, but being part of British Leyland did nothing for UK sales. The arrival of John Egan and his quality crusade boosted demand for the companies products, but the initial honeymoon with the XJ40 saloon turned sour when the car developed a reputation for unreliability in the late 1980’s. After the PR overkill of the 1980’s about Jaguars quality campaign, it convinced many consumers to buy German in future. Jaguar had been privatized in 1984, but their independence lasted a mere five years before Ford bought the ailing company in 1989.
So how did Ford manage Jaguar?
Ford pumped money into the company to bring all its production facilities up to scratch and introduced more democratic processes into product development. This was illustrated by the evolution process of the AJ26 V8 engine. The configuration of the unit was not dictated by the prejudices of the senior engineer, but by careful consideration of all the options and their pro’s and cons.
Like Geoffrey Robinson before them, Ford realised that Jaguar needed to expand to survive. Where Ford went wrong was the insistence on retro styling, which alienated younger drivers and gave them little reason to abandon the uber-modern German brands. More Jaguar branded cars were being sold, but the cost of developing them was proving crippling to Ford who saw no return in their investment. The bulked up X350 XJ saloon became the least successful car in the series, despite its technological advances.
By the time Ford realised that more modern styling was needed, the corporate will had evaporated and Tata stepped in to buy Jaguar Land Rover. But can Tata really succeed where Ford failed?