MG car production goes ‘home’

Cynics among us knew it would happen before long. That it took so long is indeed a surprise.

MG has announced it is to stop making cars at the former British Leyland (BL) plant in Longbridge, Birmingham where the Austin Metro was built using, for the first in Britain, KUKA’s automated equipment for body-in-white assembly.

The Austin Metro had its roots in the ADO88 which became the LC8. The car marked the turning point of car manufacture in the UK. Its lifespan, in its various guises, lasted from 1980 to 1997.

But now production of MG cars at the former BL site will be moving to China - ending manufacturing in the UK.
It may be recalled that MG are the initials for Morris Garages, a British sports car manufacturer that began life begun in the 1920s as a sales promotion sideline within W R Morris's Oxford city retail sales and service business. MG was started by the business's manager, Cecil Kimber. Best known for its two-seat open sports cars, MG also produced saloons and coupés. Cecil Kimber was an employee of William Morris.

This week firm said vehicle assembly was no longer "required" and cars would arrive "fully built ready for distribution".

The first new MG for 16 years rolled off the production line in the West Midlands in 2011

MG said there would be 25 redundancies but sales, marketing and after-sales operations of course would remain at the plant.

MG says the arrival of its production marked “the first large-scale production” at the plant near Birmingham since the demise of Rover in 2005. But no one could seriously call MG’s production in the UK as ‘large scale’.

The Longbridge plant, which spreads into Worcestershire, once covered 400 acres before part of it was redeveloped. It will be forever linked to trades union activist ‘Red Robbo’ – Derek Robinson.

MG claims that over 400 design engineers and other staff at the SAIC Motor Technical Centre (SMTC) at the site and MG Motor employees “are not affected”.

It just depends how one defines ‘not affected’. In car design there is nothing quite like being able to walk down to the plant and talk to the people who operate machines or assemble components to pick up ideas for the future.

"Centralising production demonstrates MG's commitment to the future, as well as its continued focus on attracting and developing the highly-skilled automotive engineering and design talent present in the UK," a spokesman for MG said.

Where possible, production staff would be moved into new roles, the spokesman added.

Two models are currently designed and made the site - MG3 and an SUV, the MG GS - and sales are increasing with the firm reporting a total year on year rise of 18 per cent.

However, even when the first SAIC MG ‘rolled’ off the production line it was clear the intention to stay was not serious. The Chinese company took what it wanted from the assets they purchased, and threw away the rest.

Sinking a solid manufacturing structure into the UK economy to build and sell cars in the same way that Nissan, Honda and Toyota have done simply was not on the cards.

In particular, one only has to visit Cowley in Oxford, Hams Hall in the West Midlands and Swindon in Wiltshire to see the imperial manner in which BMW has transformed the former British Leyland Mini into what has become a 21^st century icon. A walk round the Cowley plant shows immediately how cars should be built.

The Chinese company SAIC could have done exactly the same with the MG brand, which in its own way was another icon that needed similar treatment. But not so.

Matthew Cheyne, head of sales and marketing at MG Motor UK, said moving production abroad was "a necessary business decision".

Richard Burden, Labour MP for Birmingham Northfield, has criticised the decision, describing it as "hugely disappointing and premature".

"I understand the business concerns that MG have surrounding costs of assembly at Longbridge, which have undoubtedly been aggravated by problems with the strength of the pound," he said.

"However, more discussions should have taken place to explore alternatives and options before any decisions were finalised."

He claimed the UK government was willing to meet MG to discuss options and he had hoped the announcement would not be made until further talks had been held.

However, the writing is on the wall – as it has been for a long time. Those who have dealings with the Chinese will certainly have to be cautious in the extreme. It is a matter of two quite different cultures, as anyone who has visited China will know. 

RUMOURS in City of London share dealing rooms and among stockbrokers suggest China's SAIC Motor Corporation and its advisors from J P Morgan, have approached various US conglomerates with a view to forming a consortium that could mount a joint £7 billion bid for automotive and aerospace company GKN.

The move is prompted through SAIC's alleged interest in owning GKN's driveline business.

If the deal went through SAIC and its partners would have to unload the aerospace divisions; alternatively, SAIC and its advisors might consider including an aerospace company as part of the consortium. United Technologies and Northrop Grumman Corporation have been named as SAIC's joint bidders.