The British Motor Industry
I have recently returned to this country after several years abroad, during which I have seen a decline in the sales—and the reputation—of the British Motor Industry. Poor representation, inadequate service, and inability to compete have all contributed to this country now being a net importer. I believe your excellent magazine has done as much as anyone can to bring this sad state of affairs home, but I wonder whether, in the aftermath of the Chrysler affair, I might add a few points?
While driving recently through France and Spain I was struck by the number of new, or recently rebuilt, garages sporting the Chrysler-star. Obviously, Chrysler France have been obliging their dealers to invest in improvements designed to give their clients better service, and succeeding in selling cars! Friends of mine in the Motor Industry here tell me that distributors and dealers are not prepared to re-invest their profits from car sales, and at the present time, who can blame them? The Think Tank report rightly distributes the blame between the shop floor and management, but surely one of the problems has been the lack of market research and the fact that the manufacturers have been for too long producing the type of car they (wrongly) feel the public wants, rather than seeking to satisfy the public itself. (Surely this is the reason for over 30% Import sales and a major contribution to a trade deficit of £2.3-billion, with the Common Market countries alone, this year?).
So now we have the Government eommiffed to ploughing in hundreds of millions of pounds to shore up the Industry over the next few years. If British Leyland are to get up to £1.4-billion and Chrysler another £162-million, this means around £1.5-billion over the next ten years, if not more. If the British Motor Industry produces around one million units a year, or ten million over ten years, this means that every British car produced carries a Government subsidy of £150. But we must be fair; the subsidy will only go to 60% or so of the vehicles, produced by Leyland and Chrysler, so that their vehicles are subsidised to the tune of not £150, but £250. How long will Ford and Vauxhall be able to go on competing under such circumstances? Surely the Government would have done better to think up a plan that would aid the Industry as a whole and not merely its lame ducks?
Chrysler UK probably became a lame duck because of something that happened before Chrysler took over from Rootes—the disastrous move into Scotland. I’m extremely pro Scottish myself, but what was the rationale of siting a major production unit so far from the producers of components in the first place? Under the present circumstances, moving Avenger production to Scotland will only increase production costs, as all components will have to be transported there.
For Chrysler to continue production in Scotland is a purely political decision, not an economic one—the expediency of protecting jobs. We were told that if Chrysler folded, 25,000 jobs would go. But as it is, a full third of these jobs will go anyway, so would it not have been better for production to remain concentrated in the Midlands and let the wise old Government find a means of protecting jobs in Scotland without endangering the economic viability of the Motor Industry?
The availability of labour, and the need for jobs, is probably the main reason why the “emerging” nations, not yet techoologieally equipped to operate a motor industry, start up assembly operations. At such a stage of the nation’s technological progress, the labour is not really capable of doing more than a simple assembly operation. With the Ryton plant now due to become a KD assembly operation, I can only assume— since at one time we had a pretty good industrial base—that we must now be officially classed a “submerging” nation.
It’s a shame, really, because I’m sure that if it was properly organised our Motor Industry could make a comeback. Our machine tools are still the best, and our component industries, Lucas, GKN, etc.—are still capable of stealing business from foreign competitors in their own countries. I personally believe that the root cause lies in the great number of models that arc being produced. Ford is probably successful because its range is fairly tight. The options available means that there are overlapping Models in the range—but no duplications. In contrast, look at the number of different cars available from BL at between 1,750 c.c. and 2,200 c.c. Whatever happened to the rationalisation programme we were led to expect at the time of the Leyland series of mergers? I imagine we can look forward now to a completely new range from Chrysler, but how long will it be before Leyland begin to produce a definite range of vehicles rather than a hotch-potch of inter-competing lines? I am sure that BL could find a rational way of using all its marques—including those traditional ones that are again threatened with extinction—but using them to signify just one specific product. The alternative seems to be to look forward to the day, not many years hence, when the British market will have less than half a dozen choices of cars to buy, most of them foreign.
Sandwich Michael Chapman