Lord Stokes looks at British Leyland in an interview with Andrew Goodrick-Clarke
Five controversial years after Leyland and the troubled British Motor Holdings were put together to form British Leyland Motor Corporation the merged company is still intact. Moreover, remarkable as it would have seemed in 1970 when the group went through its blackest period, it is apparently flourishing, and, to judge from latest capital spending plans, doubly ambitious. More than ever before, then, the optimistic hopes of Lord Stokes and his team to form an internationally competitive British motor company look like being vindicated. Looking back to 1968, Lord Stokes felt that at that time his responsibilities were
” absolutely all-embracing. I think I realized then, particularly when we began to expose some of the facts of the case, that I had taken on myself a terrific commitment. It was something that I had got myself and the company and my colleagues into. It’s a huge company by British standards and a huge responsibility. And on top of that we found out that things were going to be much more difficult than we had been led to believe. In all the previous mergers that we had undertaken we had never, of course, found anything quite like this.”
At Leyland, Lord Stokes had found that he was able to get involved personally in almost every aspect of the company.
“I suddenly found that I had to transform myself into a delegator, and, at the same time, be an innovator because we had to get the thing moving. Somebody had to do something. As we found the situation, it was obvious that it was desperate. For instance, I had to decide that we were going to make the Marina. It was not a case of having committees, it was just a case of making a decision and going ahead as fast as we could.”
Today, British Leyland would launch a model based on detailed research of all the factors involved. With the Marina and, indeed, with British Leyland itself in the first two or three years, Lord Stokes recalls the necessity of “quick almost intuitive decisions”.
The effect, so far as the public saw it, was to stamp Lord Stokes’s personality almost too firmly on British Leyland. It was widely suggested that the job of chairman and chief executive of a company of this size was too much for one man. In 1970 when profits crashed from £40m to only £4m there was speculation that he would resign. Yet he disarmingly defends his role as ” a personality chairman ” by pointing out that ” this is the way I was born “. Moreover, he believes that the British prefer to be a company with a personality at its head rather than a nonentity.
“We find a lot of people we recruit prefer to be with a flesh and blood chairman, maybe irascible, maybe impetuous or anything else, but at least they have someone they can get a decision from. And I think they become involved with you to a certain extent. We find a lot of people object to this faceless man at the top idea. I find this particularly on the shopfloor; I can go round any of our factories and I bet you most of the people know who I am, even though they may not agree with me and may not even like me. I am under no illusions about that.”
And despite British Leyland’s appalling labour problems during the past five years, a factor which was largely responsible for the 1969-70 crisis, Lord Stokes strongly believes that he is in business to create things, not destroy them.
“I had no money involved and I got the same pay exactly as I had when I was at Leyland. The point as I saw it was that this was a challenge to have a British motor industry which would. give opportunity for our children to get to the top if they could. We have reduced the number of plants. I think that is logical. We’ve actually not reduced the number of employees. In fact, we have slightly increased them. And even in 1970, I never thought that we were going to lose. It never occurred to me that we wouldn’t pull through. But there were times when it was pretty black.
We got a fair basin of criticism from people who didn’t really understand the problem. The banks helped us a lot, of course. The joint stock banks, particularly, were very understanding. I went round and spoke to all the bankers individually and personally, and I think they understood the problem. On the other hand, we have never tried to lobby people. We are not great lobbyists in this company, and we never have been. I think it’s right, because if you start to try and run your business by perpetually lobbying politicians or bankers or so- called City men you just don’t get on with the job of actually running the business.
But I must say it’s a bit disturbing when the cash flow sums are going against you. And we had to chop things that I would have liked to have kept on. We chopped one of the Rover cars which I would have liked to have gone on with but there-was nothing else we could do. You’ve just got to weigh up how much money you’ve got. We would have liked to have expanded more quickly and modernize our factories earlier. But we just didn’t have the money. And one of the most remarkable things is the way that everybody cooperated. I don’t think the public realizes this, but people running factories are terribly proud of them. They like to see new plant and equipment coming in.
They like to be up to date. We had to make a lot of these people defer and cut back and prune everything. Now we have relaxed the purse strings, everyone’s smiling, of course.”
The outcome, says Lord Stokes, is that in contrast to what the sceptics were predicting a couple of years ago, they have proved that it is possible to have a British motor industry.
” A lot of people have said that we would have disappeared long ago. My colleagues at the Industrial Reorganisation Corporation said I wouldn’t live five years. Now we can claim to have arrived. And we have got our plans for the next five years. And they are real plans which we have the money to implement.”
And he sees European collaboration in the motor industry rather than further large mergers. “There should be a greater sharing of facilities with manufacturers jointly developing a new gearbox, for example. But I think people will retain their own national individuality. It will be a great pity if they don’t because I’m sure of this that if we had tried to put Jaguar design, for example, under Austin-Morris it would have been a disaster.”
Regrets? Well, there are some. The time it has taken to get industrial relations sorted out, and the lack of enthusiasm by some people about what Brtish Leyland has been trying to achieve.